BOCA RATON, Fla., May 12, 2020 /PRNewswire/ -- Celsius
Holdings, Inc. (Nasdaq: CELH), maker of the leading global fitness
drink, CELSIUS®, today reported financial results for the quarter
ended March 31, 2020.
2020 First Quarter Financial and Business Highlights:
- Revenue of $28.2 million, up 95%
from $14.5 million in the year ago
quarter
-
- Domestic revenue increased 70% to $19.4
million, up from $11.4 million
in the year ago quarter
- International revenue increased 186% to $8.8 million, up from $3.1
million in the year ago quarter
- Gross profit of $13.0 million, up
128% from $5.7 million in the year
ago quarter
-
- Gross profit margins total 46.1% (53.5% excluding outbound
freight) of revenues
- Net income of $546,000 compared
to $11.7 million, inclusive of
$12.2 million gain related to the
recognition of a note receivable, in the year ago quarter
- Non-GAAP Adjusted EBITDA* was $2.8
million compared to $878,000
in the year ago quarter
- Launched CELSIUS HEAT® Jackfruit, a refreshing exotic tropical
flavor
- Launched nationwide product availability with Walmart at more
than 1,500 store locations
- Expanded nationwide product assortment to five flavors at more
than 1,300 Target locations
*
|
The Company reports
financial results in accordance with accounting principles
generally accepted in the United States ("GAAP"), but management
believes that disclosure of adjusted EBITDA, a non-GAAP financial
measure, may provide users with additional insights into operating
performance.
|
Subsequent to Quarter End:
- Launched virtual workout program, "SWEAT WITH CELSIUS," via
Instagram
- Announced partnership with Barry's "AT HOME LIVE Instagram
Series"
- DSD (Direct store Delivery) distributors in North America grew to over 100 partners
compared to 50 when Celsius first highlighted this strategy on
their July 16, 2019 press release,
50% of newly launched Walmart stores will be serviced by DSD, with
additional stores to layer on DSD platform
-
- Same store sales growth historically has increased an
incremental 40% when shifted to DSD platform
"Our record first quarter results reflect our continued momentum
and the tremendous traction we are gaining with the distribution
and placement of our products around the world," said John Fieldly, President and Chief Executive
Officer. "We continued to leverage strategic partnerships, online
experiences and retail relationships to further increase volume in
the first quarter and deliver our fifth consecutive quarter of
sequential growth with double-digit increases across all geographic
regions while expanding gross margins and delivering positive net
income. Demand for our functional beverages remains strong, despite
a material shift in consumer purchasing behaviors towards online
platforms as a result of the recent public health crisis related to
the COVID-19 outbreak."
"Through new and expanded relationships with U.S. retailers and
additional DSD distribution agreements, we further expanded our
presence and increased throughput to consumers during the first
quarter," Fieldly continued. "Trend forward functional data
indicates CELSIUS is growing faster than the category, and our
financial results reinforce the strong performance of our
business."
Fieldly concluded, "Our agile operations and marketing teams
responded quickly in the first quarter to align our focus and
resources with the dramatic shift in retail shopping patterns and
the movement towards more online purchasing in light of increased
health and safety concerns," Fieldly continued. "We rapidly
implemented pre-set plans around production, sales and marketing
initiatives. We have moved many of our experiential off-line
activations to digital and online platforms driving a 167% increase
in our average daily online sales volume compared to a year ago. We
are closely monitoring the macro environment and are prepared to
flex and change as needed to keep our momentum going. In the first
month of the second quarter we are seeing North America sales volume growth of
approximately 38% over the prior year. Favorable market trends and
strong consumer demand for healthy beverages, combined with our
ability to scale rapidly, positions us for continued success.
Notwithstanding the foregoing, the uncertainties resulting from
Covid out break my have unforeseen or unexpected impacts on results
of operations. Our strategy of positioning Celsius as a global
leader for health-minded consumers remains our top
priority."
First Quarter Ended March 31,
2020 Compared to First Quarter Ended March 31, 2019
Revenue
For the three months ended March 31, 2020, revenue was $28.2 million, an increase of $13.7 million, or 95%, from $14.5 million for the 2019 quarter. The increase
was driven by continued strong growth of 70% in North America revenues attributable to
double-digit growth in both existing accounts and new distribution
expansion, including expansion at world class retailers.
Revenue in Europe increased
183% as a result of the full consolidation impact of operations
related to the acquisition of the company's Nordic partner in
October 2019. Revenue in Asia, which included royalty revenues from
China of $190,000, increased by $215,500. The total increase in revenue is
primarily attributable to an increase in sales volume, as opposed
to increases in product pricing.
The following table sets forth revenue by geography and changes
therein for the three-month periods ended March 31, 2020 and 2019:
|
|
Three months ended
March 31,
|
Revenue
Source
|
|
2020
|
|
|
2019
|
|
|
%
Change
|
|
|
|
|
|
|
|
|
|
Total
Revenue
|
|
$
|
28,184,889
|
|
|
$
|
14,485,650
|
|
|
95%
|
|
|
|
|
|
|
|
|
|
|
|
North
America
|
|
$
|
19,359,169
|
|
|
$
|
11,397,862
|
|
|
70%
|
|
|
|
|
|
|
|
|
|
|
|
Europe
|
|
$
|
8,500,852
|
|
|
$
|
2,999,664
|
|
|
183%
|
|
|
|
|
|
|
|
|
|
|
|
Asia
|
|
$
|
268,292
|
|
|
$
|
52,764
|
|
|
408%
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
$
|
56,576
|
|
|
$
|
35,360
|
|
|
60%
|
Gross Profit
For the three months ended March 31, 2020, gross profit increased by
$7.3 million, or 128%, to
$13.0 million, up from $5.7 million for the same quarter in 2019.
Gross profit margin for the three months ended March 31, 2020 was 46.1%, which compares
favorably to 39.5% for the 2019 quarter. The increase in gross
profit dollars reflects the impact of the consolidation of the
European operations and is mainly related to an increase in sales
volume from the 2019 quarter, as opposed to increases in product
pricing.
Sales and marketing expenses
Sales and marketing
expenses for the three months ended March
31, 2020 were $7.5 million, an
increase of $3.9 million, or 108%,
from $3.6 million in the same quarter
in 2019. The increase is primarily due to the impact of the
consolidation of the operations of the company's Nordics partner,
which were not present in the 2019 results. Consequently, marketing
expenses increased $1.6 million, or
132%, compared to the first quarter of 2019. Similarly,
all other sales and marketing expenses give effect to increases
related to the consolidation of the European business.
Specifically, employee costs increased $1.5
million or 114% from the 2019 quarter to the 2020 quarter,
and also reflect investments in human resources to properly service
our markets. Moreover, due to the increase in business volume
from the 2019 quarter to the 2020 quarter, our support to
distributors and investments in trade activities increased by
$353,000 and our storage and
distribution costs increased by $486,000.
General and administrative expenses
General and
administrative expenses for the three months ended March 31, 2020 were $4.2
million, an increase of $1.6
million, or 62%, from $2.6
million for the three months ended March 31, 2019. This increase similarly reflects
the impact of the consolidation of the operations of the company's
Nordics partner. As such, administrative expenses increased
$1.1 million. The increase was driven
by an increase in bad debt reserve of $221,000 in order to cover potential
collectability risks associated with the Covid-19 situation.
Employee costs for the three months ended March 31, 2020, reflected an increase of
$302,000 or 47%, not only
attributable to the consolidation of Func Food operations, but also
giving effect to investments in resources in order to properly
support our higher business volume. All other increases for
general and administrative expenses were $232,200 from the 2019 quarter to the 2020
quarter.
Other income / expense
Total other expenses for the
three months ended on March 31, 2020
were $0.7 million, which reflects an
increase of $12.9 million as the
prior year results included a gain of $12.2
million mainly related to the recognition of a note
receivable in the prior period. Furthermore, the results for
the 2020 quarter include amortization expenses of $310,000, interest expense on bonds payable and
financial lease obligations of $273,000, realized foreign translations losses of
$78,000 and all other items amount to
a net expense of $41,500.
Net Income / (Loss)
As a result of the all above, for
the three months ended March 31,
2020, Celsius had net income of $546,000, or $0.01
per diluted share based on a weighted average of 70,339,416 diluted
shares outstanding. In comparison, for the three months ended
March 31, 2019 the Company had net
income of $11.7 million, inclusive of
a $12.2 million gain related to the
recognition of a note receivable, or $0.19 per diluted share, based on a weighted
average of 61,687,409 diluted shares outstanding.
Liquidity and Capital Resources
As of March 31, 2020, the company had cash of
$19.1 million compared to
$23.1 million as of December 31, 2019. The company had working
capital of $27.4 million as of
March 31, 2020 compared to
$24.8 million as of December 31, 2019.
Cash used in operations during the three months ended
March 31, 2020 totaled $3.8 million, reflecting investments in inventory
of $5.5 million and other increases
in working capital to support growth.
Conference Call
Management will host a conference
call today, Tuesday, May 12, 2020 at
10 a.m. ET to discuss the results
with the investment community.
To participate in the conference call, please call one of the
following telephone numbers at least 10 minutes before the start of
the call:
U.S.:
|
1-877-709-8150
|
International:
|
1-201-689-8354
|
An audio replay of the call will be available on the Company's
website at: https://www.celsiusholdingsinc.com/press-releases/
Disclosures can be found on the Company's online disclosure
portal at: https://www.celsiusholdingsinc.com/sec-filings/.
About Celsius Holdings, Inc.
Celsius Holdings, Inc.
(Nasdaq: CELH), is a global company with a proprietary, clinically
proven formula for its master brand CELSIUS® and all its
sub-brands. A lifestyle fitness drink and a pioneer in the rapidly
growing performance energy sector, CELSIUS® has five beverage lines
that each offer proprietary, functional, healthy-energy formulas
clinically-proven to offer significant health benefits to its
users. The five lines include, CELSIUS® Originals, CELSIUS
HEAT™, CELSIUS® BCAA +Energy, CELSIUS® On-the-Go, and
CELSIUS® Sweetened with Stevia. CELSIUS® has zero sugar, no
preservatives, no aspartame, no high fructose corn syrup, and is
non-GMO, with no artificial flavors or colors. The CELSIUS® line of
products is Certified Kosher and Vegan. CELSIUS® is also soy and
gluten-free and contains very little sodium. CELSIUS® is backed by
six university studies that were published in peer-reviewed
journals validating the unique benefits CELSIUS® provides. CELSIUS®
is sold nationally at Target, CVS, Walmart, GNC, Vitamin Shoppe,
7-Eleven, Dick's Sporting Goods, The Fresh Market, Sprouts and
other key regional retailers such as HEB, Publix, Winn-Dixie,
Harris Teeter, Shaw's and Food Lion.
It is also available on Amazon, at fitness clubs and in select
micro-markets across the country. For more information, please
visit http://www.celsiusholdingsinc.com
Forward-Looking Statements
This press release may contain statements that are not historical
facts and are considered forward-looking within the meaning of the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements contain projections of Celsius Holdings'
future results of operations and/or financial position, or state
other forward-looking information. In some cases, you can identify
these statements by forward-looking words such as "anticipate,"
"believe," "could," "estimate," "expect," "intend," "may,"
"should," "will," "would," or similar words. You should not rely on
forward-looking statements since Celsius Holdings' actual results
may differ materially from those indicated by forward-looking
statements as a result of a number of important factors. These
factors include, but are not limited to: general economic and
business conditions; our business strategy for expanding our
presence in our industry; anticipated trends in our financial
condition and results of operation; the impact of competition and
technology change; existing and future regulations affecting our
business; and other risks and uncertainties discussed in the
reports Celsius Holdings has filed previously with the Securities
and Exchange Commission. Celsius Holdings does not intend to and
undertakes no duty to update the information contained in this
press release.
-- Tables Follow --
Celsius Holdings,
Inc. and Subsidiaries Consolidated Balance
Sheets
|
|
|
|
March 31,
2020
(Unaudited)
|
|
|
December 31,
2019 (1)
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash
|
|
$
|
19,094,101
|
|
|
$
|
23,090,682
|
|
Accounts
receivable-net (note 2)
|
|
|
10,699,811
|
|
|
|
7,774,618
|
|
Note
receivable-current (note 6)
|
|
|
1,157,754
|
|
|
|
1,181,116
|
|
Inventories-net (note
4)
|
|
|
21,038,367
|
|
|
|
15,292,349
|
|
Prepaid expenses and
other current assets (note 5)
|
|
|
4,671,721
|
|
|
|
4,170,136
|
|
Total current assets
|
|
|
56,661,754
|
|
|
|
51,508,901
|
|
|
|
|
|
|
|
|
|
|
Notes Receivable
(note 6)
|
|
|
10,416,120
|
|
|
|
10,630,041
|
|
Property and
equipment-net (note 8)
|
|
|
115,324
|
|
|
|
132,889
|
|
Right of use assets
(note 7)
|
|
|
626,120
|
|
|
|
809,466
|
|
Long term security
deposits
|
|
|
55,358
|
|
|
|
104,134
|
|
Intangibles (note
9)
|
|
|
17,029,472
|
|
|
|
17,173,000
|
|
Goodwill (note
9)
|
|
|
10,023,806
|
|
|
|
10,023,806
|
|
Total Assets
|
|
$
|
94,927,954
|
|
|
$
|
90,382,236
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable and
accrued expenses (note 11)
|
|
$
|
19,885,182
|
|
|
$
|
17,292,647
|
|
Lease liability
obligation (note 7)
|
|
|
587,690
|
|
|
|
649,074
|
|
Bonds payable-net
(note 13)
|
|
|
8,599,750
|
|
|
|
8,634,279
|
|
Other current
liabilities (note 12)
|
|
|
160,646
|
|
|
|
107,399
|
|
Total current
liabilities
|
|
|
29,233,268
|
|
|
|
26,683,399
|
|
|
|
|
|
|
|
|
|
|
Long-term
liabilities:
|
|
|
|
|
|
|
|
|
Lease liability
obligation (note 7)
|
|
|
188,789
|
|
|
|
239,848
|
|
Total
Liabilities
|
|
|
29,422,057
|
|
|
|
26,923,247
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingences (note 17)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
|
|
|
Common stock, $0.001
par value; 100,000,000 shares authorized, 69,279,260 and 68,941,311
shares issued and outstanding at March 31, 2020 and December 31,
2019, respectively (note 15)
|
|
|
69,280
|
|
|
|
68,942
|
|
Additional paid-in
capital
|
|
|
129,168,007
|
|
|
|
127,552,998
|
|
Accumulated other
comprehensive loss
|
|
|
(868,010)
|
|
|
|
(753,520)
|
|
Accumulated
deficit
|
|
|
(62,863,380)
|
|
|
|
(63,409,431)
|
|
Total Stockholders' Equity
|
|
|
65,505,897
|
|
|
|
63,458,989
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
94,927,954
|
|
|
$
|
90,382,236
|
|
|
|
|
|
|
|
|
|
|
(1) Derived from
Audited Consolidated Financial Statements
|
Celsius Holdings,
Inc. and Subsidiaries Consolidated Statements of
Operations (Unaudited)
|
|
|
|
For the three
months
|
|
|
|
ended March
31,
|
|
|
|
2020
|
|
|
2019
|
|
Revenue
|
|
$
|
28,184,889
|
|
|
$
|
14,485,650
|
|
Cost of
revenue
|
|
|
15,182,706
|
|
|
|
8,764,592
|
|
Gross
profit
|
|
|
13,002,183
|
|
|
|
5,721,058
|
|
|
|
|
|
|
|
|
|
|
Selling and marketing
expenses
|
|
|
7,506,047
|
|
|
|
3,601,003
|
|
General and
administrative expenses
|
|
|
4,247,853
|
|
|
|
2,622,102
|
|
Total operating
expense
|
|
|
11,753,900
|
|
|
|
6,223,105
|
|
|
|
|
|
|
|
|
|
|
Income/(loss) from
operations
|
|
|
1,248,283
|
|
|
|
(502,047)
|
|
|
|
|
|
|
|
|
|
|
Other
Income/(Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income on
note receivable (note 6)
|
|
|
97,534
|
|
|
|
-
|
|
Interest
expense
|
|
|
(136,018)
|
|
|
|
(28,632)
|
|
Amortization of
intangibles
|
|
|
(143,528)
|
|
|
|
-
|
|
Interest expense on
financial leases
|
|
|
(137,165)
|
|
|
|
-
|
|
Amortization of
discount on notes payable
|
|
|
-
|
|
|
|
(85,940)
|
|
Amortization of
discount on bonds payable
|
|
|
(166,069)
|
|
|
|
-
|
|
Other miscellaneous
income
|
|
|
5,340
|
|
|
|
-
|
|
Realized foreign
exchange (loss)
|
|
|
(77,923)
|
|
|
|
-
|
|
(Loss)/gain on
investment repayment-(note 6)
|
|
|
(144,403)
|
|
|
|
12,273,213
|
|
Total Other
Income/(Expense)
|
|
|
(702,232)
|
|
|
|
12,158,641
|
|
|
|
|
|
|
|
|
|
|
Net
Income
|
|
|
546,051
|
|
|
|
11,656,594
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income/(loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized foreign
currency translation (loss)/gain
|
|
|
(114,490)
|
|
|
|
260,665
|
|
Comprehensive
income
|
|
$
|
431,561
|
|
|
$
|
11,917,259
|
|
|
|
|
|
|
|
|
|
|
Income per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.01
|
|
|
$
|
0.20
|
|
Diluted
|
|
$
|
0.01
|
|
|
$
|
0.19
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
|
69,284,307
|
|
|
|
57,155,445
|
|
Diluted
(1)
|
|
|
70,339,416
|
|
|
|
61,687,409
|
|
Celsius Holdings,
Inc.
Reconciliation of Non-GAAP Financial Measure
|
|
|
|
Three months ended
Mar 31,
|
|
|
2020
|
|
2019
|
|
Net income (loss)
available to common stockholders (GAAP measure)
|
546,051
|
|
11,656,594
|
|
Add/(subtract)
back:
|
|
|
|
|
Depreciation and
amortization expense
|
434,536
|
|
107,343
|
|
Net interest
expense
|
136,018
|
|
28,632
|
|
Stock-based
compensation
|
1,400,000
|
|
1,358,503
|
|
Gain/(loss) on
transaction
|
144,403
|
|
(12,273,213)
|
|
Non-GAAP Adjusted
EBITDA
|
2,661,008
|
|
877,860
|
|
Non-recurring one-time
charges:
|
|
|
|
|
Acquisition
Costs
|
100,000
|
|
|
|
Total non-recurring
one-time charges
|
100,000
|
|
0
|
|
Non-GAAP Adjusted
EBITDA excluding one-time charges
|
2,761,008
|
|
877,860
|
|
Net Asia
investment
|
0
|
|
0
|
|
Net Non-GAAP
Adjusted EBITDA excluding net Asia investment*
|
2,761,008
|
|
877,860
|
*The Company reports financial results in accordance
with accounting principles generally accepted in the United States
("GAAP"), but believe that disclosure of adjusted EBITDA, a
non-GAAP financial measure, may provide users with additional
insights into operating performance.
|
Investor Relations:
Cameron
Donahue
(651) 653-1854
cameron@haydenir.com
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SOURCE Celsius Holdings, Inc.