Sean asked a question about it as it reported or where we thought we would be. Look, it’s going to definitely be over reported, and my goal is to have growth over where we thought we could have ended up this year.
Unidentified Analyst: Okay. Thanks. And then last question kind of regarding the safe and then raise. Is there going to be any additional capital need to be raised in the interim? Or do you think that will carry you guys for the year?
Norman Snyder: Our belief is that will carry us through the year. I mean, obviously, the burn has been really minimized to almost eliminate it, and that’s the goal there. So, the cash needs are really exclusively to build inventory and just to have enough inventory to be able to respond and drive up our on-time and in full delivery percentage is north of 95%.
Unidentified Analyst: Okay, great. Awesome. That’s all I’ve got. I’ll hop back in the queue.
Norman Snyder: You’re welcome, Will.
Operator: The next question is from Gary Getz [ph], a private investor. Please go ahead.
Unidentified Analyst: Yes, hi Norm. Thanks for taking the call and it looks like we’re on the right track. Most of my questions have been answered. I just wanted to make a comment about the ginger and wanted to reinforce what you’re doing about developing new ginger products. It has great health benefits, and I commend you on doing what you’re doing.
Norman Snyder: Thank you. Gary, I know you were, I think, unable to attend the last earnings call because you had a commitment, but I think it wouldn’t be an earnings call if you didn’t come on the line and ask a question. So, I always look forward to hearing from you.
Unidentified Analyst: Thank you very much and I enjoy listening to you Norm.
Norman Snyder: Thanks.
Operator: This concludes our question-and-answer session.
Norman Snyder: No, we have one additional question.
Operator: Okay. And that question comes from Jack [Indiscernible] another private investor. Please go ahead.
Unidentified Analyst: Yes. Hi. Can you guys hear me?
Norman Snyder: I can.
Unidentified Analyst: Okay. Awesome. Yes. Sorry, not last but not least. I just wanted to touch on the two sort of one-off having senses the non-cash packaging inventory valuation adjustment of $1.8 million and then the provision on the — what was it, the product hold related to the swing-lid program for $1.3 million. Can you add any like insights to like specifically what those — what happened under these circumstances?
Norman Snyder: Well, let me address the swing-lid issue because that’s a little bit simpler. As we talked about, we had a malfunction with our closure so we pulled that product and didn’t sell it. We have product, packaging insurance, function insurance that we have filed a claim, but the auditors required us to reserve for that. So, until we collect those insurance proceeds, we had to put a reserve up. And then conversely, when we do receive insurance proceeds, that will be a game and we’ll have the flip. And unfortunately, because the two events straddle the fiscal year, you’ll have a charge in one year and then a pickup in the subsequent year.
Unidentified Analyst: Okay. Okay, I’m tracking.
Norman Snyder: All right. Now, for the inventory, we’ve had a lot of different — it’s primarily packaging materials that we thought we could use for limited time offers and special additions and had — and we’ve done that on a limited basis, but two things. One, since we were experiencing a higher-than-normal level of short shipments, the reality of the matter is, when are we going to have time to do these and execute on these programs. And since there’s a cost associated with storing materials, my logistics team convinced me that the benefit of holding them to do these programs later was not in our best interest, so we decided that we would write those down. Now, some items we are going to — we retain and will use and some of this also was formulation changes and labeling requirements, it was labels, it was wraps, carriers.
But some items we’re still going to use. So, again, similar to the swing-lid thing, there will be a pickup in the year that we actually use those. And then another piece was related to our candy business where we’ve gone into a license agreement and we’re in the process of transitioning that inventory over, but we had to take — the auditors required us to take a reserve on that. It’s still good inventory. And again, as we transition that over just like the swing-lid, there’ll be a pickup there.
Unidentified Analyst: Okay. And I want–
Norman Snyder: Jack, one thing I want to emphasize, all of these are non-cash related adjustments. So, there was no cash hit. It’s really an accounting reserve driven, which obviously depresses results, and that’s why we included in adjustments to modified EBITDA to show what things are on a normalized basis. But look, we just thought it was prudent to do it. It made sense. As I said earlier, we have a really strong team here. We’re making better decisions. We’re driving more efficiencies. You can see what we’ve done. Our margins a year ago were in the low 20s. We’ve driven up into the mid-30s and really believe that’s sustainable with continued improvement. We brought our logistics cost down. They will continue to go down, and we’ve really held our SG&A in check, in fact, lowered it over the prior year. And I think until we’re in a position to generate more cash that we can invest from a marketing side and reinvest in our brand, we’ve really accomplished a lot.
Unidentified Analyst: Yes. No, that all makes perfect sense. So, I guess, the sort of tangent that I would have resulting from what you said would be — of those two items, and again, I’m not going to hold you to the number, but I would be curious, like do you have any idea like it sounds like they’re sort of gone but not forgotten. And if we were to recoup whether it be from insurance or the ability to actually use some of the packaging and whatnot that was written off, like do you guys have an estimate of like what we might be able to recruit from that or an expectation or anything along that lines?
