Launches regional direct-store-delivery partnerships in first phase of route-to-market evolution
Announces productivity initiative targeting annualized cost benefits of
First Quarter 2024 Highlights
-
Net sales decreased 10.4% year over year to
$38.8 million - Unit volume decreased 10.4% year over year to 3.0 million equivalized cases
- Gross profit margin was 45.7%, down 0.8 percentage points year over year but up 5.0 percentage points from prior quarter
-
Net loss was
$7.2 million , including$1.5 million of non-cash equity-based compensation expense -
Adjusted EBITDA loss was
$5.5 million (1) -
Loss per share was
$0.10 per diluted share to Zevia’s Class A Common stockholders
(1) Adjusted EBITDA is a non-GAAP financial measure. See the supplementary schedules in this press release for a discussion of how we define and calculate this measure and a reconciliation thereof to the most directly comparable GAAP measure. |
“First quarter results were in line with our expectations as we continued to encounter top-line headwinds stemming from the fulfillment challenges we faced in 2023,” said
“I am also excited to announce the first phase of our direct-store-delivery roll out. DSD will enable our acceleration into the convenience channel as well as the margin-accretive and trial-driving singles distribution, while improving in-store presence in our existing footprint. We are launching in a strong Zevia market in the
First Quarter 2024 Results
Net sales decreased 10.4% to
Gross profit decreased 11.9% to
Selling and marketing expenses were
General and administrative expenses were
Equity-based compensation, a non-cash expense, was
Net loss for the first quarter of 2024 was
Loss per share for the first quarter of 2024 was
Adjusted EBITDA loss was
Balance Sheet and Cash Flows
As of
Productivity Initiative
The Company recently began executing a multi-year, broad-based Productivity Initiative designed to realign our cost structure in order to accelerate our route-to-market evolution and build the Zevia brand. We expect estimated annualized benefits in the range of
Guidance
The Company expects net sales for the full year of 2024 to be in the range of
Webcast
The Company will host a conference call today at
Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the
About Zevia
(ZEVIA-F)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED) (in thousands, except share and per share amounts) |
||||||||
|
|
Three Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Net sales |
|
$ |
38,799 |
|
|
$ |
43,300 |
|
Cost of goods sold |
|
|
21,080 |
|
|
|
23,195 |
|
Gross profit |
|
|
17,719 |
|
|
|
20,105 |
|
Operating expenses: |
|
|
|
|
|
|
||
Selling and marketing |
|
|
15,070 |
|
|
|
11,912 |
|
General and administrative |
|
|
8,115 |
|
|
|
8,645 |
|
Equity-based compensation |
|
|
1,489 |
|
|
|
2,380 |
|
Depreciation and amortization |
|
|
328 |
|
|
|
419 |
|
Total operating expenses |
|
|
25,002 |
|
|
|
23,356 |
|
Loss from operations |
|
|
(7,283 |
) |
|
|
(3,251 |
) |
Other income, net |
|
|
97 |
|
|
|
340 |
|
Loss before income taxes |
|
|
(7,186 |
) |
|
|
(2,911 |
) |
Provision for income taxes |
|
|
13 |
|
|
|
1 |
|
Net loss and comprehensive loss |
|
|
(7,199 |
) |
|
|
(2,912 |
) |
Loss attributable to noncontrolling interest |
|
|
1,375 |
|
|
|
821 |
|
Net loss attributable to |
|
$ |
(5,824 |
) |
|
$ |
(2,091 |
) |
|
|
|
|
|
|
|
||
Net loss per share attributable to common stockholders |
|
|
|
|
|
|
||
Basic |
|
$ |
(0.10 |
) |
|
$ |
(0.03 |
) |
Diluted |
|
$ |
(0.10 |
) |
|
$ |
(0.04 |
) |
|
|
|
|
|
|
|
||
Weighted average common shares outstanding |
|
|
|
|
|
|
||
Basic |
|
|
55,890,168 |
|
|
|
49,372,874 |
|
Diluted |
|
|
55,890,168 |
|
|
|
72,250,338 |
|
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands) |
||||||||
|
|
|
|
|
|
|
||
ASSETS |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
28,720 |
|
|
$ |
31,955 |
|
Accounts receivable, net |
|
|
14,048 |
|
|
|
11,119 |
|
Inventories |
|
|
30,621 |
|
|
|
34,550 |
|
Prepaid expenses and other current assets |
|
|
3,965 |
|
|
|
5,063 |
|
Total current assets |
|
|
77,354 |
|
|
|
82,687 |
|
Property and equipment, net |
|
|
1,902 |
|
|
|
2,109 |
|
Right-of-use assets under operating leases, net |
|
|
1,812 |
|
|
|
1,959 |
|
Intangible assets, net |
|
|
3,435 |
|
|
|
3,523 |
|
Other non-current assets |
|
|
560 |
|
|
|
579 |
|
Total assets |
|
$ |
85,063 |
|
|
$ |
90,857 |
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Accounts payable |
|
|
19,045 |
|
|
$ |
21,169 |
|
Accrued expenses and other current liabilities |
|
|
8,153 |
|
|
|
5,973 |
|
Current portion of operating lease liabilities |
|
|
592 |
|
|
|
575 |
|
Total current liabilities |
|
|
27,790 |
|
|
|
27,717 |
|
Operating lease liabilities, net of current portion |
|
|
1,216 |
|
|
|
1,373.0 |
|
Total liabilities |
|
|
29,006 |
|
|
|
29,090 |
|
|
|
|
|
|
|
|
||
Stockholders’ equity |
|
|
|
|
|
|
||
Class A common stock |
|
|
58 |
|
|
|
54 |
|
Class B common stock |
|
|
14 |
|
|
|
17 |
|
Additional paid-in capital |
|
|
187,366 |
|
|
|
191,144 |
|
Accumulated deficit |
|
|
(107,161 |
) |
|
|
(101,337 |
) |
Total |
|
|
80,277 |
|
|
|
89,878 |
|
Noncontrolling interests |
|
|
(24,220 |
) |
|
|
(28,111 |
) |
Total equity |
|
|
56,057 |
|
|
|
61,767 |
|
Total liabilities and equity |
|
$ |
85,063 |
|
|
$ |
90,857 |
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) |
||||||||
|
|
Three Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Operating activities: |
|
|
|
|
|
|
||
Net loss |
|
$ |
(7,199 |
) |
|
$ |
(2,912 |
) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
||
Non-cash lease expense |
|
|
147 |
|
|
|
142 |
|
Depreciation and amortization |
|
|
328 |
|
|
|
419 |
|
Gain on disposal of property, equipment and software, net |
|
|
(12 |
) |
|
|
— |
|
Amortization of debt issuance cost |
|
|
19 |
|
|
|
19 |
|
Equity-based compensation |
|
|
1,489 |
|
|
|
2,380 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable, net |
|
|
(2,929 |
) |
|
|
(3,239 |
) |
Inventories |
|
|
3,929 |
|
|
|
(1,374 |
) |
Prepaid expenses and other assets |
|
|
1,098 |
|
|
|
546 |
|
Accounts payable |
|
|
(2,112 |
) |
|
|
14,589 |
|
Accrued expenses and other current liabilities |
|
|
2,180 |
|
|
|
(1,025 |
) |
Operating lease liabilities |
|
|
(140 |
) |
|
|
(148 |
) |
Net cash (used in) provided by operating activities |
|
|
(3,202 |
) |
|
|
9,397 |
|
Investing activities: |
|
|
|
|
|
|
||
Purchases of property, equipment and software |
|
|
(33 |
) |
|
|
(862 |
) |
Net cash used in investing activities |
|
|
(33 |
) |
|
|
(862 |
) |
Financing activities: |
|
|
|
|
|
|
||
Proceeds from revolving line of credit |
|
|
8,000 |
|
|
|
— |
|
Repayment of revolving line of credit |
|
|
(8,000 |
) |
|
|
— |
|
Proceeds from exercise of stock options |
|
|
— |
|
|
|
23 |
|
Net cash provided by financing activities |
|
|
— |
|
|
|
23 |
|
Net change from operating, investing, and financing activities |
|
|
(3,235 |
) |
|
|
8,558 |
|
Cash and cash equivalents at beginning of period |
|
|
31,955 |
|
|
|
47,399 |
|
Cash and cash equivalents at end of period |
|
$ |
28,720 |
|
|
$ |
55,957 |
|
Use of Non-GAAP Financial Information
We use Adjusted EBITDA, a financial measure that is not calculated in accordance with
We calculate Adjusted EBITDA as net income (loss) adjusted to exclude: (1) other income (expense), net, which includes interest (income) expense, foreign currency (gains) losses, and (gains) losses on disposal of fixed assets, (2) provision (benefit) for income taxes, (3) depreciation and amortization, and (4) equity-based compensation. Also, Adjusted EBITDA may in the future be adjusted for amounts impacting net income related to the Tax Receivable Agreement liability and other infrequent and unusual transactions.
Adjusted EBITDA is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Some of the limitations of Adjusted EBITDA include that (1) it does not properly reflect capital commitments to be paid in the future, (2) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and Adjusted EBITDA does not reflect these capital expenditures, (3) it does not consider the impact of equity-based compensation expense, including the potential dilutive impact thereof, and (4) it does not reflect other non-operating expenses, including interest (income) expense, foreign currency (gains) losses and (gains) losses on disposal of fixed assets. In addition, our use of Adjusted EBITDA may not be comparable to similarly titled measures of other companies because they may not calculate Adjusted EBITDA in the same manner, limiting its usefulness as comparative measures. Because of these limitations, when evaluating our performance, you should consider Adjusted EBITDA alongside other financial measures, including our net loss or income and other results stated in accordance with GAAP.
The following table presents a reconciliation of net loss, the most directly comparable financial measure stated in accordance with GAAP, to Adjusted EBITDA for the periods presented:
|
|
Three Months Ended |
|
|
|||||
(in thousands) |
|
2024 |
|
|
2023 |
|
|
||
Net loss and comprehensive loss |
|
$ |
(7,199 |
) |
|
$ |
(2,912 |
) |
|
Other income, net* |
|
|
(97 |
) |
|
|
(340 |
) |
|
Provision for income taxes |
|
|
13 |
|
|
|
1 |
|
|
Depreciation and amortization |
|
|
328 |
|
|
|
419 |
|
|
Equity-based compensation |
|
|
1,489 |
|
|
|
2,380 |
|
|
Adjusted EBITDA |
|
$ |
(5,466 |
) |
|
$ |
(452 |
) |
|
* Includes interest (income) expense, foreign currency (gains) losses, and (gains) losses on disposal of fixed assets. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240508927488/en/
Investors
424-343-2654
Gregory@zevia.com
ICR
646-277-1260
Reed.Anderson@icrinc.com
Source: