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MamaMancini's Reports Second Quarter Fiscal Year 2018 Financial Results

EAST RUTHERFORD, NJ, Sep 13, 2017 (Marketwired via COMTEX) --

Q2 Fiscal 2018 Revenue Up 69% over prior year, Topping $7 million; Q2 2018 Net Income: $24,000 vs. Q2 2017 Net Loss of $(277,000); Company reports 4th consecutive profitable quarter; Pro Forma Cash EBITDA, including pro forma results from pending consolidation of Joseph Epstein Foods Enterprise, Inc., reaches record $635,000 in Q2

EAST RUTHERFORD, NJ--(Marketwired - Sep 13, 2017) - MamaMancini's Holdings, Inc. (the "Company" or "MamaMancini's") (OTCQB: MMMB), a marketer of specialty pre-prepared, frozen and refrigerated all natural food products (as defined by the United States Department of Agriculture), today announced financial results for the second quarter of fiscal year 2018, ended July 30, 2017.

Second Quarter Highlights:

Second quarter of fiscal year 2018 revenue increased 69% to $7.0 million compared to $4.1 million in prior year period.

Net income for the second quarter was $24,000 versus net loss of $(277,000) in prior year period; a $301,000 improvement.

Net loss available to common stockholders was $(5,000), or $0.00 per diluted share, during the second quarter of fiscal 2018, compared to a net loss of $(324,000), or $(0.01) per diluted share in the same quarter last year.

Cash EBITDA, a non-GAAP financial metric (please refer to Non-GAAP Financial Measures paragraph below), for the second quarter was $377,000 compared to $145,000 in the second quarter of fiscal 2017.

Company has sold approximately 40,600 SKU's in 11,900 retail and grocery locations at July 31, 2017 as compared to approximately 36,000 SKU's in 11,400 retail and grocery locations at July 31, 2016.

Based on preliminary financial statements provided to the Company by Joseph Epstein Foods, Inc. ("JEFE") (which are subject to their audit and final due diligence), Pro forma Cash EBITDA including JEFE results on a pro forma consolidated basis (a non-GAAP financial metric--please refer to Non-GAAP Financial Measures paragraph below) for the second quarter would have been approximately $635,000, representing an increase of approximately $258,000 over the Company's reported Cash EBITDA on a standalone basis. Please see paragraph below concerning the Pro Forma results.

Six Months Highlights:

First six months of fiscal year 2018 revenue increased 53% to $12.4 million compared to $8.1 million in prior year period.

Net income for the six months period was $153,000 versus net loss of $(503,000) in prior year period; a $656,000 improvement.

Net income available to common stockholders was $76,000, or $0.00 per diluted share, compared to a net loss of $(614,000), or $(0.02) per diluted share in the same quarter last year.

Cash EBITDA, a non-GAAP financial metric (please refer to Non-GAAP Financial Measures paragraph below), for the six months period was $890,000, an increase of 161% when compared to $341,000 in the same period of fiscal 2017.

Based on preliminary financial statements provided to the Company by Joseph Epstein Foods, Inc. ("JEFE") (which are subject to their audit and final due diligence), Pro forma Cash EBITDA including JEFE results on a pro forma consolidated basis (a non-GAAP financial metric--please refer to Non-GAAP Financial Measures paragraph below) for the first six months of fiscal year 2018 would have been approximately $1,185,000, representing an increase of nearly $295,000 over the Company's reported Cash EBITDA on a standalone basis. Please see paragraph below concerning the Pro Forma results.

Cash flow from operating activities was $389,000 compared to $(23,000) in the year ago quarter.

Carl Wolf, Chief Executive Officer of MamaMancini's, commented, "The second quarter was outstanding from a revenue perspective; continuing the growth trajectory of recent quarters. This growth stems directly from our strategy of focusing on selling our products into the prepared foods, ready to eat meals and sandwich shop area located on fresh foods perimeter of the retail grocery store. Progressive retail stores are looking to take advantage of the growing consumer trend toward a broad array of delicious, nutritious, all-natural and easy to prepare products. As a result, we have been able to sell into higher volume per location accounts over the traditional pre-packaged retailer merchandising. We believe this trend is accelerating as evidenced by the recent acquisition of Whole Foods by Amazon."

Mr. Wolf continued, "The rapid growth we are currently experiencing has required the acquisition of new equipment and additional processes to meet current demand; which is having a moderate impact on our gross profit and operating margins year-to-date. We expect margins to move back up to more traditional levels as we move through the second half of the year. Also during the quarter, we signed a letter of intent to acquire the primary manufacturer, of our products, Joseph Epstein Foods Enterprise ("JEFE"), on a non-cash basis. Based upon preliminary information received from JEFE (subject to completion of due diligence and audit), we estimate that the integration of our sole supplier will increase our gross profit margin and profits by $1.5 million or more in the next 12 months and believe that the acquisition will assure a reliable source of supply for the Company for years to come. 

"As MamaMancini's continues on this growth trajectory, it became clear to us that the combination of the two entities would secure manufacturing capacity for the company's products and, as a result of operating efficiencies, be immediately accretive to our earnings and thereby reward our shareholders. We anticipate closing this transaction in early November 2017. This acquisition involves no cash or stock outlay." Please see the Company's SEC filing on Form 8-K on September 11, 2017 for further details.

Mr. Wolf concluded, "It is an exciting time at MamaMancini's as the strategic direction we put in place is coming to fruition. We have now reported profitability in each of the last four consecutive quarters and our revenue growth is accelerating. Looking ahead, our goal is to get to a $40 million annualized sales run rate, which is anticipated before the end of the current fiscal year. Our focus right now is execution, making sure we can deliver our products on a consistent basis and meet current customer demand. We are excited with the opportunities ahead."

Second Quarter 2018 Results Sales, net of slotting fees and discounts, were $7.0 million for the second quarter of fiscal 2018, a 69% increase compared to $4.1 million reported in the second quarter of fiscal 2017. The Company has sold approximately 40,600 SKU's in 11,900 retail and grocery locations at July 31, 2017 as compared to approximately 36,000 SKU's in 11,400 retail and grocery locations at July 31, 2016. Gross profit for the second quarter of fiscal 2018 was $2.0 million, or 29% of sales, compared to $1.4 million, or 33% of sales, in the year ago period. Operating income for the second quarter of fiscal 2018 was $207,000, compared to an operating loss of $(109,000) in the second quarter of fiscal 2017. Net income for the second quarter of fiscal 2018 was $24,000, compared to a net loss of $(277,000) in the second quarter of fiscal 2017.

Six Months Fiscal 2018 Results Sales, net of slotting fees and discounts, were $12.4 million for the first six months of fiscal 2018, a 53% increase compared to $8.1 million reported in the prior year period. Gross profit for the first six months of fiscal 2018 was $3.9 million, or 32% of sales, compared to $2.8 million, or 35% of sales, in the year ago period. Operating income for the first six months of fiscal 2018 was $524,000, compared to an operating loss of $(164,000) in the first six months of fiscal 2017. Net income for the first six months of fiscal 2018 was $153,000, compared to a net loss of $(503,000) in the first six months of fiscal 2017.

Non-GAAP Financial Measures The Company uses Cash EBITDA as a non-GAAP financial measure. The Company defines Cash EBITDA as earnings before income taxes, depreciation and amortization plus any non-cash stock payments for expenses. The Company believes that the use of Cash EBITDA is useful to investors and other users of its financial statements in evaluating the Company's operating performance because it provides them with an additional tool to compare business performance across companies and across periods. The Company uses Cash EBITDA in conjunction with traditional GAAP operating performance measures as part of its overall assessment of its performance, for planning purposes, including the preparation of its annual operating budget, and to evaluate the effectiveness of its business strategies. Management does not place undue reliance on Cash EBITDA as its only measure of operating performance. Cash EBITDA should not be considered as a substitute for other measures of financial performance reported in accordance with GAAP.

Pro Forma Results including Joseph Epstein Foods Enterprise, Inc. ("JEFE") The Pro Forma results which include the consolidation of the results of JEFE are based on preliminary financial information that the Company has received from JEFE. These financial results are subject to changes from their audit and due diligence prior to the consolidation which is expected about November 1, 2017.

Conference Call The Company has scheduled a conference call for Thursday, September 14, 2017 at 9:00 a.m. ET, to review the results.

Interested parties may participate on the conference call by dialing (844) 889-4326 or (412) 317-9264. A replay of the conference call will be available by dialing (877) 344-7529 or (412) 317-0088, confirmation code 10112126, through September 20, 2017.

About MamaMancini's MamaMancini's is a marketer and distributor of a line of beef meatballs and turkey meatballs all with sauce, five cheese stuffed beef and turkey meatballs all with sauce, original beef and turkey meatloaves, chicken parmesan, stuffed peppers and other similar Italian cuisine products. The Company's sales have been growing on a consistent basis as the Company expands its distribution channel, which includes major retailers and distributors such as Costco, Publix, Shop Rite, Jewel, Save Mart, Lucky's, Lunds and Byerlys, SuperValu, Safeway, Albertsons, SpartanNash, Bashas, Whole Foods Market, Hy-Vee, Shaw's, Kings, Roche Bros., Key Foods, Stop & Shop, Giant, Giant Eagle, Foodtown, Sam's Club, Kroger, Shoppers,, King Kullen, Lowes, Central Market, Weis Markets, Ingles, Food City, The Fresh Market. Sysco, Burris Foods, and C&S. The Company sells a variety of its products on air and on line on QVC, the world's largest direct to consumer marketer.

Forward Looking Statements This press release may contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. "Forward-looking statements" describe future expectations, plans, results, or strategies and are generally preceded by words such as "may," "future," "plan" or "planned," "will" or "should," "expected," "anticipates," "draft," "eventually" or "projected." You are cautioned that such statements are subject to a multitude of 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, and other risks identified in the Company's 10-K for the fiscal year ended January 31, 2017 and other filings made by the Company with the Securities and Exchange Commission.

Financial Tables to Follow

                                                                                                                                                                                                
                                                                                                                                                                                                
MamaMancini's Holdings, Inc.                                                                                                                                                                         
Condensed Consolidated Balance Sheets                                                                                                                                                                
                                                                                                                                                                                                
                                                                                                                                    July 31, 2017          January 31, 2017      
                                                                                                                                    (Unaudited)                             
Assets                                                                                                                                                            
                                                                                                                                                             
Assets:                                                                                                                                                           
Cash                                                                                                                                     $      639,454         $        666,580      
Accounts receivable, net                                                                                                                   3,064,576           1,817,820    
Inventories                                                                                                                                235,207             443,623      
Prepaid expenses                                                                                                                           143,188             135,747      
Due from manufacturer - related party                                                                                                      1,597,518           2,079,708    
Total current assets                                                                                                                       5,679,943           5,143,478    
                                                                                                                                                             
Property and equipment, net                                                                                                                1,299,183           1,175,508    
                                                                                                                                                             
Deposit on machinery and equipment                                                                                                         493,855             -            
Total Assets                                                                                                                             $      7,472,981       $        6,318,986    
                                                                                                                                                             
Liabilities and Stockholders' Equity                                                                                                                              
                                                                                                                                                             
Liabilities:                                                                                                                                                      
Accounts payable and accrued expenses                                                                                                    $      891,609         $        484,752      
Line of credit, net                                                                                                                        2,454,151           1,363,145    
Term loan                                                                                                                                  140,004             140,004      
Note payable - net                                                                                                                         2,126,736           1,401,906    
Total current liabilities                                                                                                                  5,612,500           3,389,807    
                                                                                                                                                             
Term loan - net of current                                                                                                                 443,326             513,328      
Note payable - net of current portion                                                                                                      -                   1,298,819    
Notes payable - related party                                                                                                              117,656             117,656      
Total long-term liabilities                                                                                                                560,982             1,929,803    
                                                                                                                                                             
Total Liabilities                                                                                                                          6,173,482           5,319,610    
                                                                                                                                                             
Commitments and contingencies                                                                                                                                     
                                                                                                                                                             
Stockholders' Equity:                                                                                                                                             
Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 shares issued and outstanding, respectively                --                  --           
Preferred stock, $0.00001 par value; 19,880,000 shares authorized; no shares issued and outstanding                                        --                  --           
Common stock, $0.00001 par value; 250,000,000 shares authorized; 31,503,662 and 27,810,717 shares issued and outstanding, respectively     315                 278          
Additional paid in capital                                                                                                                 16,064,056          15,825,029   
Common stock subscribed, $0.00001 par value; 66,667 shares, respectively                                                                   1                   1            
Accumulated deficit                                                                                                                        (14,615,373 )            (14,676,432 )
                                                                                                                                                             
Less: Treasury stock, 230,000 shares, respectively                                                                                         (149,500    )            (149,500    )
Total Stockholders' Equity                                                                                                                 1,299,499           999,376      
                                                                                                                                                             
Total Liabilities and Stockholders' Equity                                                                                               $      7,472,981       $        6,318,986    
                                                                                                                                                                                      
                                                                                                                                                                                      
MamaMancini's Holdings, Inc.                                                                                                                                                               
Condensed Consolidated Statements of Operations                                                                                                                                            
(Unaudited)                                                                                                                                                                                
                                                                                                                                                                                      
                                                              For the Three Months Ended July 31,                   For the Six Months Ended July 31,                  
                                                              2017                  2016                  2017                  2016               
                                                                                                           
Sales-net of slotting fees and                                     $      7,005,434      $      4,138,280      $      12,362,735     $      8,062,257   
                                                                                                           
Costs of Sales                                                       4,995,088        2,772,966        8,452,811        5,221,744   
                                                                                                           
Gross profit                                                         2,010,346        1,365,314        3,909,924        2,840,513   
                                                                                                           
Operating expenses:                                                                                             
             Research and development                           24,531           37,225           50,119           67,787      
             General and administrative                         1,778,348        1,437,256        3,336,176        2,937,113   
                          Total operating expenses         1,802,879        1,474,481        3,386,295        3,004,900   
Income (loss) from operations                                        207,467          (109,167   )          523,629          (164,387   )
                                                                                                           
Other income (expense):                                                                                         
Interest expense                                                     (174,338   )          (157,949   )          (344,995   )          (319,711   )
             Amortization of debt discount                      (8,730     )          (9,694     )          (26,010    )          (18,819    )
                          Total other income (expense)     (183,068   )          (167,643   )          (371,005   )          (338,530   )
                                                                                                           
Net income (loss)                                                  $      24,399           (276,810   )          152,624          (502,917   )
                                                                                                           
Less: preferred dividends                                            (44,765    )          (46,800    )          (91,565    )          (111,321   )
                                                                                                           
Net income (loss) available to common stockholders                   (20,366    )          (323,610   )          61,059           (614,238   )
                                                                                                           
Net loss per common share - basic                                  $      (0.00      )          (0.01      )          0.00             (0.02      )
Net loss per common share - diluted                                $      (0.00      )          (0.01      )          0.00             (0.02      )
Weighted average common shares outstanding - basic                   27,947,539       27,039,199       27,880,255       26,776,279  
Weighted average common shares outstanding - diluted                 27,947,539       27,039,199       29,198,164       26,776,279  
                                                                                                                                                                                    
                                                                                                                                                                                    
MamaMancini's Holdings, Inc.                                                                                                                                                             
Condensed Consolidated Statements of Cash Flows                                                                                                                                          
(Unaudited)                                                                                                                                                                              
                                                                                                                                                                                    
                                                                                                                              For the Six Months Ended                         
                                                                                                                              July 31, 2017         July 31, 2016    
                                                                                                                                                 
CASH FLOWS FROM OPERATING ACTIVITIES:                                                                                                                 
Net income (loss)                                                                                                                  $      152,624        $      (502,917 )
                    Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:                           
                                                                 Depreciation                                              219,205          159,703   
                                                                 Amortization of debt discount and debt issuance costs     26,011           18,819    
                                                                 Share-based compensation                                  147,499          352,137   
Changes in operating assets and liabilities:                                                                                                          
                    (Increase) Decrease in:                                                                                                      
                    Accounts receivable                                                                                         (1,246,756 )          116,339   
                    Inventories                                                                                                 208,416          (155,226 )
                    Prepaid expenses                                                                                            (7,441     )          (43,891  )
                    Due from manufacturer - related party                                                                       482,190          67,918    
                    Increase (Decrease) in:                                                                                                      
                    Accounts payable and accrued expenses                                                                       406,857          (36,285  )
                                                                 Net Cash Provided by (Used In) Operating Activities       388,605          (23,403  )
                                                                                                                                                 
CASH FLOWS FROM INVESTING ACTIVITIES:                                                                                                                 
Cash paid for fixed assets                                                                                                           (836,735   )          (204,083 )
                                                                 Net Cash Used In Investing Activities                     (836,735   )          (204,083 )
                                                                                                                                                 
CASH FLOWS FROM FINANCING ACTIVITIES:                                                                                                                 
Repayment of note payable                                                                                                            (600,000   )          -         
Borrowings (repayments) of line of credit, net                                                                                       1,091,006        144,810   
Repayment of term loan                                                                                                               (70,002    )          (60,000  )
Repayment of promissory notes                                                                                                        -                (180,300 )
                                                                 Net Cash (Used In) Provided By Financing Activities       421,004          (95,490  )
                                                                                                                                                 
Net Decrease in Cash                                                                                                                 (27,126    )          (322,976 )
                                                                                                                                                 
Cash - Beginning of Period                                                                                                           666,580          587,422   
                                                                                                                                                 
Cash - End of Period                                                                                                               $      639,454          264,446   
                                                                                                                                                 
SUPPLEMENTARY CASH FLOW INFORMATION:                                                                                                                  
Cash Paid During the Period for:                                                                                                                      
                    Income taxes                                                                                              $      -                -         
                    Interest                                                                                                  $      145,241          76,311    
                                                                                                                                                 
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:                                                                              
                                                                                                                                                 
Stock issued for Series A Preferred dividends                                                                                      $      91,565         $      178,314   
Accrued dividends                                                                                                                  $      91,565         $      64,521    
Debt issuance costs included in principal balance of note                                                                          $      52,236         $      -         
Prepaid stock-based compensation                                                                                                   $      -              $      28,125    
Accrued interest reclassified to principal balance of convertible note                                                               -                270,323   

Contact: Carl Wolf Chairman and CEO MamaMancini's Holdings, Inc. Stock Symbol: MMMB 973-985-0280 www.mamamancinis.com carl@mamamancinis.com

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