Greetings, and welcome to Tattooed Chef first quarter 2022 Conference Call. At this time, all participants are in a listen-only mode. A question- and- answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Devin Sullivan, Senior Vice President, The Equity Group. Thank you, and over to you. Thank you. Good afternoon, everyone, and welcome to Tattooed Chef's 2022 first quarter financial results conference call. On the call today are Sam Galletti, President and Chief Executive Officer, Sarah Galletti, Chief Creative Officer, Tattooed Chef, and Stephanie Dieckmann, Chief Financial Officer. Matt Williams, the company's Chief Growth Officer, will also be available for questions. Earlier this afternoon, the company issued its press release, a copy of which is available in the investors section of the company's website at www.tattooedchef.com. Before we begin, I'd like to remind everyone that the prepared remarks contain forward-looking statements. Such statements involve a number of known and unknown uncertainties, many of which are outside the company's control and could cause future results, performance, or achievements to differ significantly from the results, performance, or achievements expressed or implied by such forward-looking statements. Important factors and risks that could cause or contribute to such differences are detailed in the company's filings with the Securities and Exchange Commission. Except as required by law, the company undertakes no obligation to update any forward-looking or other statements herein, whether as a result of new information, future events, or otherwise. In addition, within the earnings release and in today's prepared remarks, adjusted EBITDA is referenced. It is important to note that this is a non-GAAP financial measure that the company believes is a useful metric that better reflects the performance of its business on an ongoing basis. A reconciliation of this non-GAAP financial measure to its most directly comparable GAAP financial measure is included in today's press release, which has also been posted on the company's website. With that said, it is my pleasure to now turn the call over to Tattooed Chef's President and CEO, Sam Galletti. Sam, please go ahead. Thank you, Devin. Given that we just reported our full year 2021 results in March, we will keep our remarks brief. Our first quarter performance and 2022 outlook reflect the resiliency of our model, the success of our investments and initiatives to meet growing consumer demand for plant-based food and the scope of the opportunities that we are pursuing. The realities of COVID, along with global inflationary pressures, are inescapable. To mitigate their effects, we are investing in activities that support our vertically integrated operating model and advance our strategies of product innovation, distribution, marketing, and strategic M&A. To be successful, we must continue to plan conservatively, adjust accordingly, and act with conviction, just as we've done since becoming a public company. The initiatives we undertook in 2021 to increase our capacity, elevate our brand profile, and expand our retail footprint are yielding results. We delivered our best ever quarterly revenue since coming public in 2020, with 2022 first quarter net sales of $72 million. Branded product sales rose 21% from last year's first quarter and were driven by a significant increase in U.S. distribution points, increased volume at existing retail stores, and new product introductions. We are focused on building demand for our products and attracting and retaining consumers to our brand. During the first quarter of 2022, we added more than 10,000 points of distribution, and branded SKUs rose to 90 from 78 at the end of 2021. We continue to expand our store count and now are available in more than 16,000 stores, tripling our store count since the same time last year. This has led to a doubling of our ACV as well to 54% of the U.S. MULO market. Consumption data for the first quarter, as measured by SPINS/IRI, continues to prove our strategies are working. We are the fastest growing health and wellness brand in the categories in which we compete, which include frozen appetizers and snacks, breakfast, entrees, vegetables, and plant-based burgers. In MULO, our consumption sales are up 49.6% versus one year ago. For example, in frozen breakfast foods, we grew retail dollars 32% and remain the number one health and wellness brand as measured by SPINS. In the frozen plant-based entree category, Tattooed Chef is now the second ranked health and wellness brand, only behind Amy's Kitchen, and growing the fastest of all the top five brands in the category. Tattooed Chef dollar velocity and unit velocity in this same category are double that of the leading brand in the category. Frozen entrees remain one of the largest categories in the aisle, and we clearly have momentum and are taking market share. Despite significantly higher domestic and international logistics costs, our gross margins rebounded from 2021 fourth quarter to 11.3%, and we remain on plan to achieve our annual gross profit targets of 10%-12% for fiscal year 2022. We are confident we can continue to capture share, and further establish our presence in the growing and global plant-based food marketplace. Scale will help us achieve this goal. We currently operate five facilities comprised of approximately 315,000 sq ft of manufacturing space. This includes our California facility, which also serves as our headquarters, our New Mexico operations, which we acquired in May 2021, Ohio, which we acquired in December 2021, and our facility in Piacenza, Italy, where we grow much of product. Today, we expect these facilities to generate $280 million-$285 million of revenue in 2022, with the capacity at present to produce upwards of $600 million in annual revenue over the next two to three years. Leveraging this scale is a key focus for 2022. We are focused on driving efficiencies and making the investments necessary to put us on a path to achieving long-term sustainable profitability. Under the leadership of our COO, Gasper Guarrasi, we are introducing automation and robotics across our company. Our automation and robotics initiatives will allow us to improve operational efficiencies, increase production capacity, lower operating and labor costs, increase gross profit, and meet our long-term ESG strategy. We are also committed to fortifying our vertically integrated operating model by bringing certain capabilities in-house. This not only provides us with more control, but is also designed to generate material cost savings. For example, we are near completion of the construction of our in-house food and safety inspection laboratory within our California facility. Our turnkey raw material and finished goods cold storage facility, located in Vernon, California, became operational in April 2022. This facility will house refrigerated, frozen, and ambient goods. As we discussed on last quarter's call, we estimate that this facility will produce an approximately 50% annualized cost savings as compared to using third-party storage, with initial savings expected to be realized in the current second quarter. We are also diversifying our product mix outside of the freezer aisle to refrigerated and ambient. This not only broadens our retail shelf space, but it also introduces products that carry lower production and shipping costs when compared to frozen products. Our New Mexico facilities commenced the production of Tattooed Chef burritos and quesadillas during the first quarter of this year, and is slated to produce salty snacks by the end of 2022. Ohio is scheduled to commence production and distribution of our refrigerated Tattooed Chef oat butter bars in the second quarter of 2022. We are very proud of what we have accomplished, and I am more excited and optimistic than ever about where we can take this brand in the years ahead. Still, we are mindful that we are operating in an environment with more than its fair share of economic uncertainty. We will therefore take a measured approach to our growth, balancing expansion with prudent fiscal management and initiatives designed to deliver material ROI. We have to date operated with exceptional low leverage for a high growth company and will maintain that posture as we continue to expand our business and brand. I'd like to turn over the call to Sarah to discuss our innovation and marketing initiatives. Sarah? We started off the year strong by introducing a slate of new products designed to satisfy everybody's plant-based side. These delicious plant-based foods have been created to appeal to the nostalgia we all feel for our favorite childhood meals, made in a sustainable, healthier way. For example, our plant-based pizzas are one of the signature items that put Tattooed Chef on the map and continue to be some of our fastest-turning SKUs. Americans love pizza. Frozen retail pizzas alone are a $6 billion business, up 9% year-over-year as of April 2021, according to IRI data. This year, we are expanding the plant-based pizza experience with both unique flavor profiles and nostalgic flavors. Some of my personal favorites are our new vegan wood-fired pizzas, including the Rainbow State, Killer Bee, and Brocc and Roll. Our innovation will allow consumers to experience different cuisines and flavors in a delicious, 100% vegan wood-fired pizza, and we are excited to see them in the market. Our new frozen product categories include handheld burritos, both breakfast and all occasion, as well as quesadillas and Mexican entrees that incorporate a variety of tasty plant-based meat alternatives and ingredient combinations, such as the plant-based chorizo and egg burrito, the plant-based al pastor quesadilla, and plant-based chicken mole enchiladas. Mexican cuisine as a category is lagging behind others when it comes to plant-based innovation. Mexican food is now more popular than hamburgers in American dining. We see a true unmet need in this category and believe it is ready for a chef's modern take on traditional Mexican cuisine. We are also significantly expanding our vegan line across several of our existing product portfolios by incorporating vegan eggs, cheese, and proprietary meat alternatives, including plant-based pork, into our meals. Finally, we are expanding beyond the freezer aisle with our refrigerated oat butter bar. We wanted to create a better bar than what is available today in terms of nutritional benefits and taste. We knew that we could compete by coming out with something different, yet familiar, and tap into the next trends of what consumers are looking to buy. This is one of the first bars made with oat butter and to be adaptogen-powered. The concept is feed your mind with a focus on brain fuel and reducing anxiety. Many bars today are still packed with sugar, soy, or filler ingredients that are not familiar to consumers. Every ingredient in our bar has a purpose. Our Tattooed Chef bars are vegan, soy-free, gluten-free, non-GMO, contain no sugar alcohols, and have between 12 - 15 gm of protein per bar. In terms of our marketing efforts, as we have shared in previous earnings calls, our goal is to meet consumers where they are across TV, social channels, retail, and experiential events. In 2022, we are accelerating with the most aggressive marketing to date, more than doubling our spend to build consumer awareness and engagement. In Q1, we did a significant television buy, reaching 280 million U.S. consumers. We are pleased with the results to date as we saw an increase in household awareness growing from 11% at year-end, 2021, to 17% at the end of Q1. In addition to continuing our TV advertising spend, we rolled out new social campaigns and programming designed to expand our community, build loyalty to our Tattooed Chef brand, and create awareness for our evolving product line. I'll now turn the conversation over to Stephanie for a discussion of what our results. Stephanie. Good afternoon, everyone. Ladies and gentlemen, the line for Stephanie Dieckmann is disconnected. We are trying to connect with Stephanie Dieckmann. Please kindly stay connected. Thank you. Ladies and gentlemen, we have Stephanie Dieckmann online with us. Ms. Dieckmann, please go ahead. We apologize, everyone, for the delay. Good afternoon, everyone. Revenue increased 37.3% to $72.1 million during the first quarter, up from $52.5 million in the first quarter of 2021. This growth was driven by several factors, including a 21.2% increase in Tattooed Chef branded products and to a lesser extent, growth in private label. First quarter revenues also benefited from $2.9 million of advertising in relation to Costco sales that are not likely to recur later in 2022. Cost of goods sold increased 41.1% to $63.9 million in the first quarter of 2022 from $45.3 million in last year's first quarter due to higher revenue and inflationary pressures that resulted in significant quarter-over-quarter increases in material costs, logistic costs, cold storage expenses, and labor expenses. Specifically, freight costs for first quarter 2022 were $10 million compared to $7.8 million first quarter 2021. There was a 2% increase as a percentage of legacy comparable sales. As a result, gross profit was $8.2 million or 11.3% of revenue, compared to $7.2 million or 13.7% of revenue in Q1 2021. While gross profit declined from last year's first quarter, it was a significant improvement from the gross profit reported in the immediately preceding fourth quarter of 2021. As Sam mentioned, our new dedicated cold storage facility became operational in April 2022, and we expect to realize the associated cost savings this quarter. We expect that gross margin will also be positively impacted as we transition the acquisitions in both New Mexico and Ohio from private label co-manufacturers into manufacturing Tattooed Chef branded products during 2022 and 2023. We expand our product mix into the refrigerated and ambient space. Over the longer term, our investments in automation will allow us to increase our production capacity, improve yields, and decrease labor costs within our current manufacturing footprint. Operating expenses rose to $24.8 million in the first quarter of 2022, from $14.2 million in last year's fourth quarter. This increase was driven by a $3.5 million increase in marketing expenses, a $2.4 million increase in operating expenses from acquired facilities during later quarters in 2021. A $1.8 million increase in professional expenses, a $1.5 million increase in payroll and recruiting expenses, $1.1 million increase in finished goods cold storage expenses, which were offset by a $2 million decrease in stock compensation expense. Net loss was $17.6 million or negative $0.22 per diluted share, as compared to a net loss of $8.2 million or negative $0.11 per diluted share. Adjusted EBITDA was negative $13.4 million in the 2022 first quarter compared to an adjusted EBITDA loss of $3.4 million in Q1 2021. The quarter-over-quarter variance was due primarily to the substantial increases in costs that resulted in lower gross margins, as mentioned earlier. We continue to maintain a strong financial position. At March 31, 2022, cash was $57.4 million and long-term debt was $0.6 million. Net cash used in operating activities was $26.4 million, $21.4 million of which was attributable to an increase in accounts receivable, reflecting significantly higher sales in Q1 2022. Capital expenditures were $8.8 million and primarily reflected down payments made on new equipment for automation during 2022. Our outlook for 2022 is unchanged, which we believe is appropriate given the persistent inflationary environment and backdrop of supply chain constraints. We expect 2022 annual revenue of $280 million-$285 million, gross margin of 10%-12%, marketing expenses of $27 million-$32 million, and capital expenditures of $20 million, primarily focused on automation and robotics. Thank you all for your attention, and I'll turn the conversation back to Sam. Thanks, Stephanie. Let's open the call for questions from our analysts. Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Thank you. The first question comes from the line of Brian Holland with Cowen and Co. Please go ahead. Yeah, thanks. Good evening, everyone. I will start with the gross margin, if I could. You know, came in right around the midpoint of the full year guidance. As we look out over the balance of the year, is it your expectation that 1Q would be the lowest gross margin quarter of the year? Just your latest thoughts on the cadence around that would be helpful. Regarding the cadence for gross margin, our thoughts are that this quarter will fall in line. We expect that next quarter will be roughly the same, with some pickup in Q3 and Q4 due to the cold storage facility that we've put in place, plus the automation of robotics that we've discussed in the operations space. Oh, perfect. Just on the OpEx line. That came in about 20% higher than I modeled. I'm not sure what that looks like or what that looked like relative to internal plan. You know, is that the right number for a baseline here as we project out over the balance of the year? Stephanie, I appreciate you walking through kind of the line by line drivers of that increase, but maybe it would be helpful to get some perspective on, you know, which of those numbers stay. Do any of those items sort of wear off as we go through the year? Kind of a similar question around gross margin, just focused on the OpEx side. Within the operations expenses, we had a couple of things that happened during Q1 2022, and one of them is that $2.9 million advertising that I mentioned. That doesn't recur later in 2022. We had additional expenses in audit fees and legal due to the restatement that occurred for 2021. We also participated in Expo West, and it was really important to us as Tattooed Chef to really be a big presence at that show. There were expenses that were spent to really show up to Expo West. Really bring Tattooed Chef to the floor in a spectacular way. I appreciate. It maybe said another way, if I ask whether Q1 gross margin would be the low watermark for 2022. Is Q1 OpEx sort of a high watermark for the year and that number could gradually sort of come down, or should we be thinking about it roughly consistent with what we saw this quarter? High margin for the year. I expect it to come down in Q2, Q3, and Q4 this year, and we'll really see that stabilization in next quarter. Okay. Appreciate that. Then just last one. You know, cash burn obviously in Q1 would look faster than what I was forecasting. If gross margin is stable and OpEx comes down, maybe that helps a little bit. Just kind of two questions. I think, Stephanie, you said last quarter balance sheet would be sufficient to carry you the next couple of years. I'm curious whether that still holds. Two, I guess for Sam, you know, you've made a couple acquisitions over the past year. There's obviously a jump in marketing spend this year. You know, I'm hearing about the investments in technology and automation. Just kind of given the unprecedented inflation that we've seen, you talked about being prudent. Can you just kind of give us some thoughts and some examples maybe about, you know, where you are trying to be nimble with this plan, to sort of navigate what what obviously is, essentially an unprecedented backdrop right now for CPG? Hey, Brian, let me take cash first because I think that cash is incredibly important, and then I'll turn it over to Sam. On the cash burn, we look at cash burn. I think that we really need to keep in mind that with the growth in revenue, that our accounts receivable came up over $21 million as compared to Q4 2021. When you combine that in with the $8.8 million that we spent in down payments on capital expenditures just in Q1, I think that when we start to talk about cash burn, that kind of goes away. Add in the $2.9 million in marketing, there's some other marketing expenses that are prepaid, and that cash burn is not nearly as significant. We're still pretty. We're pretty good as far as cash is concerned, certainly for the next 12 months and probably longer than that without there being any concern. Also, I'd like to remind everybody that we have $0.6 million in long-term debt. We're not a company out there that's been financing our purchases, whether it be our acquisitions or our capital expenditures. We are working with our banks on a credit facility, and that would be there as a safety net, and as it made sense as we go through this year and next year into the future. Sam, do you wanna take the other question? Sure. Hey, Brian, how you doing? Good, Sam. The investment that we've already made here in Tattooed Chef since we started this, you know, was with these acquisitions that we made, it's going to be. We're at a place today where we have all of this overhead now, you know, guidance to be $280 million-$285 million. Like Stephanie mentioned, within this infrastructure now that we've built out, we could do like $600 million in sales is what our projections are. It's like we went from this, you know, small, privately held company, and then we had to overspend to catch up to be a publicly traded company. Now we have all these acquisitions that we've made that we're just trying to ramp up here with Sarah's innovation. We are not even selling any chips, and we are not selling any bars, and we are not really launched our Mexican food line except for some. I mean, we still. We started with the burritos and quesadillas and, you know, we are in Kroger, and we have got some great distribution going. We feel that that is a tremendous opportunity in plant-based Mexican food. Now we have all of this infrastructure that we are paying for every day at a guidance of $200-$285. Within that infrastructure, with now very minimal additional costs, we could do so much more on revenue. We built this platform, and now we have got this infrastructure, and we continue to build this team out. Yes, I mean, you know, if we weren't hit with these inflationary issues, I mean, it would be so much more. Nothing's smooth, but it would be so much more of a interesting ride. Now there's a little bit of headwinds, but it's like, you know, the way I'm looking at this thing is when we're doing $400 million-$500 million in sales and now our increases, our costs will increase minimally. We're gonna be driving costs down, increasing sales. I really do believe that we have a really excellent opportunity here to really meet gross margins that, you know, we're not even discussing yet. But we're really in the right position going forward here. Thanks. I appreciate it. I'll hop back in the queue. Best of luck. Thank you. Thank you. The next question comes from the line of Rob Dickerson with Jefferies. Please go ahead. Great. Thank you so much. I just had a question on the revenue side. I think I heard in the prepared remarks something, you know, stated around Costco that might not repeat for the remainder of the year. Then, you know, if I think about the guide for the year, right, you know, what that implies is essentially you'd be doing kind of a similar, you know, revenue run rate per quarter as you kinda did in Q1. Kind of I'm guessing that, like, there is kinda more in Q1 maybe coming from Costco, maybe a little bit less in Q2, but then it kinda comes back up. In the latter part of the year. That's kind of the first question is kind of what was the Costco piece? Then the second piece was just, you know, in terms of the guide on the revenue side, does that include, you know, what does that include? Like, does that only include, you know, current business, kind of what you have visibility on current products? Does that include anything, you know, kind of on the innovation side with some of the Mexican-based products or bars or what have you? That's it. Thanks. Hey, Rob. It's Stephanie here. The $2.9 million that I mentioned for Costco was actually advertising expense that won't recur, so it's actually in our operating expenses. When we talk about the growth at Costco and things like that, Costco will come down some in Q2 and in Q3 and Q4, not sequentially come down. Q1 is always our biggest quarter with Costco. What we're looking at in Q2 and Q3 and Q4, and I'm sure that Matt can add to this, is the business that we generated last year with new retailers and with SKUs and building onto that. Remember that we get the full year advantage of that this year, which we did not in 2021. We've got that built in. There are some things coming up that we have vision of and that we have foresight of that are built in, but for the most part, it's really existing business. There's nothing out there that's hanging for our revenue goals this year that could happen or maybe will happen. Matt, do you wanna add to that? Obviously, we have commitments built into the latter part of the year that have not obviously hit the market yet, so we've obviously included that in the guidance. Clearly the innovation pipeline that we're filling with the Mexican entrees, like Sam mentioned, again, we have some commitments that we're working towards getting ready for shipping obviously in Q3 and Q4 as well as the end of Q2. Then also bars. So we've already started to gain commitments from our distributors as well as some early customer reads on bars being built into our plan as well. We don't have a lot of revenue built in for the chips as of right now just due to timing. We do expect that to be part of our Q3 and Q4 numbers at some point as well. I'd just like to. Okay, perfect. I'd just like to add one. Go ahead, Sam. Rob, just one additional thing, Rob. The one thing that, you know, people, when we first came out, and we were very skewed towards club, you know, there was, like, a lot of focus on, hey, you know, club is could be fleeting. It's really, you know, it's just such a, it's one customer, and it's so much volume. The stability from this company will be when we really are able to launch into all the different retail, conventional retailers across the United States. That is really what was, what people were looking from us at Tattooed Chef and not be so dependent on Costco, is to be, is to diversify our business. That's what's happened. I mean, it was in the earnings report, we said that last year we were at 5,000 stores, and now we're in 16,000 retail stores. That's exactly what people were looking at is not to be so, you know, so much with just club, and that's what we've accomplished in the last year, and we're very proud of that. All right. Super. You know, I guess, kind of basic question. You know, in your conversations with retailers now, you know, welcoming, I'm sure there's some SKUs, depending on the retailer, that do better than other SKUs. You know, the expansion of the doors, obviously you'd want to be able to expand your total distribution points, every day if you could. You know, is it kind of a conversation that's occurring now, you know, look, this is what we've done so far. We have new innovation. You know, obviously you're looking to take shelf, right, within the freezer. It doesn't sound just kind of by your tone that there's, you know, very much pushback on the retailer side. They might not take 50 SKUs that are new, but, you know, there's obviously sounds like there is some reception to bringing in new SKUs off of the new innovation while holding the ground with the other points of distribution. Well, well put. Rob, this is. Oh, yeah. You go. No, Matt, you go ahead, bud. You go ahead. No, I mean, I think, you know, Rob, that is obviously the strategy. You know, not only is it. I mean, I don't think it's just about them wanting to accept Tattooed Chef SKUs. I think it's also that we're bringing SKUs in the doors that are kind of ripe for plant-based innovation. I think it's also not just that the brand is proving itself out where we are gaining distribution or, you know, where we've gained distribution historically, but we're also bringing innovation that's in line with what consumers are looking for. I think those are the two things that are really working in our favor. Obviously, the Mexican line is where we're really emphasizing the push now as well as breakfast. I mean, you know, these are, like I said, categories ripe for innovation with plant-based. We're seeing a lot of early acceptance of that. You know, we had Kroger take three SKUs kinda right out of the gate as part of a review in 1,800 stores. They're continuing to, you know, be very bullish on the brand. Our velocities, you know, when we enter these new categories, we obviously have to benchmark off of usually the market share leader. In that case, it was Amy's in the, you know, in that burrito category. We're punching right at kind of Amy's level in terms of velocity. That is the model. I mean, we still have a lot of runway in terms of you know, distribution and closing distribution gaps with customers. But it's really about the right SKU assortment and reaching you know, that target of 30 SKUs per chain. We're already there. I mean, we have four retailers right now in different parts of the country that are now carrying over 30 SKUs. There's Publix that is right there, Lowe's as well as Hannaford up in the Northeast. It's the strategy and that's obviously us continuing to bring plant-based innovation to the freezer aisle. All right, super. If I can just sneak one kind of simple one in for Stephanie. Just in terms of the $21 million in the accounts receivable shift, you know, I respect, you know, that number, you know, changes you know, kind of, you know, as revenues build. Is there like a timing? Is there timing visibility as to maybe when that reverses out? Or should we be thinking, you know, as you know, post your revenues for Q2, we assume that they're the same level, let's say, as Q1, that, you know, that would still be kind of the piece of it within working cap. That's it. Thanks. When it comes to accounts receivable, we will see accounts receivable come down some in Q2. It really had more to do with timing of promotions and things like that at Costco, which remember that we always participate in these things. Costco runs Organic Month, Sam's Club runs Healthy For You during Q1. It's not really a tapering off of anything. It just happens to be a very wonderful time in Q1 to be in plant-based foods, particularly with everybody coming out of the holiday season. That being said, we'll see accounts receivable come down some in Q2, but if we're starting to do revenue in these numbers, then accounts receivable will be higher than it was at the end of Q4 2021, but not at this level in Q2, and we'll start to stabilize Q2, Q3, Q4 in that accounts receivable balance. Okay. Makes sense. Thank you. Thank you. The next question comes from the line of George Kelly with Roth Capital Partners. Please go ahead. Hi, everybody. Can you hear me? We can, George. Okay, great. First question for Stephanie. Just to go back to the, it was an earlier question about the kind of cadence of gross margin and operating expenses. If I go through and run those numbers, it sounds like they both should be helping EBITDA throughout the year. It sounded just, you know, with gross margin improvement and the operating expenses coming down, like, I guess the question is: Is there a chance of you reaching EBITDA breakeven any quarters this year? Could you maybe provide any kind of timing for your expectations around that? Our expectations remain unchanged from what they were at the end of 2021, in which we believe that we start to see breakeven and positive adjusted EBITDA in the back half of 2023. We don't feel that there will be a significant loss in adjusted EBITDA as there is in Q1 due to some of our front-loaded expenses that just occurred during Q1. We will start to see operating costs come down some because those Q1 expenses aren't there that we already talked about. We'll see that in Q2, Q3, and Q4, which would have a positive improvement on our adjusted EBITDA. We just don't think that it'll get to breakeven in 2022, and we feel that it's more important still at this moment in time to take and spend the marketing money and continue to build that household awareness and get Tattooed Chef into distribution. We are still holding more inventory in our hands today than we would during a normal year with our ramp-up in growth to help make sure that Tattooed Chef does not have supply chain issues, that Tattooed Chef is able to be on the shelf everywhere we can possibly put it at this time, George. Okay. Okay, great. Hey, George. And then- George. Yep. This is Sam. You know, I just wanted to jump in here, too. I think it's really unique about the company is that we have so many levers to be able to pull from to increase our gross margins by being a manufacturer. If we were a typical, you know, brand that was getting co-packed, you know, we wouldn't be able to buy the CapEx and the equipment and the robotics. We wouldn't be able to get our own cold storages, you know, to be able to save money. It's not just raising a price to fix all and potentially, you know, pricing ourselves out. We have so much more opportunity and so many more levers to pull on that we do really think we're gonna be profitable by the end of next year in this company between all of the things that are going on and then increasing our sales with all the different. Because as we discussed in the past, the chips, the bars, they command higher gross margins and frozen also. There's so many ways that we believe that we could be profitable in this company. Forty-three million, I think, was the number for branded in the quarter. Two questions about that. Can you quantify the contribution from New Mexico Food Distributors and Belmont Confections in that branded line? Was there any? The second question is, if you're running now at about a $200 million branded business annualized, how meaningful will the contribution from them be once they start selling more branded? I mean, should it be a material number for second half of this year, 2023? As of right now, George, the branded products out of New Mexico and Ohio are very little to the overall Tattooed Chef brand. We're still in the process of converting those facilities over to Tattooed Chef. Matt and his team are out there working hard. I can promise you that. Kroger did see the first launch of the burritos and quesadillas during Q1 that were made in our New Mexico facility. Those are things that come into play more so in the back half of this year, and certainly by 2023. Please remember that the bars that we talk about will come out of Ohio, and the continued entree lines for the plant-based Mexican food will come out of New Mexico. I guess just more broader that I'm gonna try one more time. How quickly, once they are up and running, and it sounds like you have good early distribution, you're getting good reception from retailers who show these products. I mean, is this gonna be within a couple years a serious contributor? Or I don't wanna put time, I guess, to it, but what does it look like right now, if you can sort of fill in any detail just about how quickly they should ramp? I would say that by next year, New Mexico for sure should be a serious contributor, both in the New Mexico Food Distributors facility and in the Carson facility. Carson will be up and running later this quarter, and that's of course where we've talked about salty snacks and things of that nature. I think that that's really more 2023. As Matt mentioned earlier on this call, we haven't really baked that into our guidance for this year. As much as we wanna say, "Hey, plant-based bars, we'll be ready to make them at the end of Q2," I don't know how much meaningful to the overall annual revenue that those bars will have in 2022. 2023, I think, is where we'll see the real contribution. I think overall, if you were to ask each of us individually, we'd have a different idea of what that product mix should be between Tattooed Chef brand and private label. I think that where we truly wanna see it is between 75%-80% branded, with the remainder being private label. Okay. Last question from me. Curious if you've taken much price, and do you feel like pricing's in a good place now? The second part of that is, have you seen much, sort of shifting in consumer behavior or buying patterns just based on where your prices are now currently set? I'll take private label pricing. Okay. I'm gonna turn over to Matt on some of the other stuff. Okay. We've taken pricing very selectively on some existing private label and some existing co-manufactured business. We continue to look at our structure and determine the role that price can play to improve our margins, while also taking into account the future automation and robotics that we're putting in and what we can do on our side so that we can really evaluate where pricing needs to come through. Matt, do you wanna talk about Tattooed Chef and our demographics and what the consumer's looking for? Yeah. I think that first, George, you know, we have seen some of the market share leaders in our space obviously take pricing. We have been very close to that in monitoring our price as it relates to our category and kinda how we stack up to them, obviously geographically. Clearly, trade is an area that we're very focused on as a way to mitigate a wholesale price increase at this point in order to drive effectiveness in terms of our overall, you know, promoted price. That's really where we're focusing today. As you would expect, as we've seen, pricing kinda move north, we do, you know, obviously see that our market share is gaining. We had, you know, our best consumption period of our company's history in Q1. You know, obviously that is very positive and we expect that as you know, pricing does you know continue to move northward, that will obviously benefit us because we have been one of the higher priced brands within the space where we sit today. Okay. That's helpful. Thank you. Thank you. Thank you. Ladies and gentlemen, we have reached the end of question and answer session, and I would like to turn the call back to Sam Galletti for closing remarks. Thank you everyone for your participation today. We have a number of conference appearances scheduled over the next month, including events sponsored by Cowen and Company, Oppenheimer, and Jefferies. We look forward to telling our story at these events and hope to see some of you there. Have a great day, everyone. Thank you. This concludes today's conference. You may disconnect your lines at this time, and thank you for your participation.