Celsius Holdings Reports Second Quarter 2024 Financial Results
Record second quarter revenue of
Record second quarter gross profit of
Second quarter diluted EPS of
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20240806461910/en/
Revenue (in millions) (Graphic: Business Wire)
Summary Financials |
2Q 2024 |
2Q 2023 |
Change |
1H 2024 |
1H 2023 |
Change |
(Millions except for percentages and EPS) |
||||||
Revenue |
|
|
23% |
|
|
29% |
|
|
|
23% |
|
|
29% |
International |
|
|
30% |
|
|
36% |
Gross Margin |
52.0% |
48.8% |
+320 BPS |
51.6% |
46.6% |
+500 BPS |
Net Income |
|
|
55% |
|
|
70% |
Net Income att. to Common Shareholders |
|
|
63% |
|
|
82% |
Diluted EPS |
|
|
65% |
|
|
77% |
Adjusted EBITDA* |
|
|
29% |
|
|
48% |
FINANCIAL HIGHLIGHTS FOR THE SECOND QUARTER OF 2024
Revenue for the second quarter of 2024 increased 23% to
Retail sales of Celsius in total
International sales of
Gross profit for the second quarter of 2024 increased 32% to
Diluted earnings per share for the second quarter increased 65% to
FINANCIAL HIGHLIGHTS FOR THE FIRST HALF OF 2024
Revenue for the first half of 2024 increased 29% to
Gross profit for the first half of 2024 increased 43% to
Diluted earnings per share for the first half of the year increased 77% to
BUSINESS OPERATIONS AND COMPANY HIGHLIGHTS
Share Growth
Celsius’ energy drink category dollar share in MULOC in the last-four-week period ended
Celsius gained approximately 35% more retail shelf space, increasing the average SKUs selling per store to 20 from 15, according to Circana’s last-four-week read ended
Alternative Growth Drivers
Club channel sales for the quarter ended
Celsius sales to Amazon increased 41% year over year to approximately
Approximately 12.1% of Celsius’ total
Innovation and Marketing
Sales of CELSIUS Essentials continue to exceed the company’s expectations and have reached 64% ACV and 4.4 average items sold per store5. CELSIUS Essentials were sold in more than 124,602 stores in the last-four-week period ended
Celsius introduced three great tasting and refreshing 12-ounce flavors during the summer: CELSIUS Sparkling Watermelon Lemonade, CELSIUS Sparkling Kiwi Strawberry and CELSIUS Sparkling
International Expansion
Celsius began sales in the
Sales in
Sales in
Second Quarter 2024 Earnings Webcast
Management will host a webcast at
*The company reports financial results in accordance with generally accepted accounting principles in
1Circana Total US MULOC L13W ended 6/30/24, RTD Energy |
2Circana Total US MULOC L4W ended 7/14/24, RTD Energy |
3Circana Total US MULOC L13W ended 6/30/24, RTD Energy |
4Circana Total US MULOC L4W ended |
5Circana Total US MULOC L4W ended 7/14/24, RTD Energy |
6Circana Total US MULOC L4W ended 7/14/24, RTD Energy |
About
Forward-Looking Statements
This press release contains statements that are not historical facts and are considered forward-looking statements 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 or financial position, or state other forward-looking information. You can identify these statements by the use of words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “should,” “will,” “would,” “could,” “project,” “plan,” “potential,” “designed,” “seek,” “target,” and variations of these terms, the negatives of such terms and similar expressions. You should not rely on forward-looking statements because 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: the strategic investment by and long term partnership with PepsiCo, Inc.; management’s plans and objectives for international expansion and future operations globally; general economic and business conditions; our business strategy for expanding our presence in our industry; our expectations of revenue; operating costs and profitability; our expectations regarding our strategy and investments; our expectations regarding our business, including market opportunity, consumer demand and our competitive advantage; anticipated trends in our financial condition and results of operation; the impact of competition and technology change; existing and future regulations affecting our business; the Company’s ability to satisfy, in a timely manner, all
CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except par value) (Unaudited) |
|||||||
|
|
|
|
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
903,210 |
|
|
$ |
755,981 |
|
Accounts receivable-net |
|
262,920 |
|
|
|
183,703 |
|
Note receivable-current-net |
|
1,166 |
|
|
|
2,318 |
|
Inventories-net |
|
180,669 |
|
|
|
229,275 |
|
Deferred other costs-current |
|
14,124 |
|
|
|
14,124 |
|
Prepaid expenses and other current assets |
|
22,900 |
|
|
|
19,503 |
|
Total current assets |
|
1,384,989 |
|
|
|
1,204,904 |
|
|
|
|
|
||||
Property and equipment-net |
|
36,282 |
|
|
|
24,868 |
|
Deferred tax assets |
|
22,727 |
|
|
|
29,518 |
|
Right of use assets-operating leases |
|
1,507 |
|
|
|
1,957 |
|
Right of use assets-finance leases |
|
233 |
|
|
|
208 |
|
Deferred other costs-non-current |
|
241,276 |
|
|
|
248,338 |
|
Intangibles-net |
|
11,491 |
|
|
|
12,139 |
|
|
|
13,730 |
|
|
|
14,173 |
|
Other long-term assets |
|
6,653 |
|
|
|
291 |
|
Total Assets |
$ |
1,718,888 |
|
|
$ |
1,536,396 |
|
|
|
|
|
||||
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
|
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
47,423 |
|
|
$ |
42,840 |
|
Accrued expenses |
|
79,633 |
|
|
|
62,120 |
|
Income taxes payable |
|
5,374 |
|
|
|
50,424 |
|
Accrued promotional allowance |
|
156,479 |
|
|
|
99,787 |
|
Lease liability obligation-operating leases-current |
|
729 |
|
|
|
980 |
|
Lease liability obligation-finance leases |
|
61 |
|
|
|
59 |
|
Deferred revenue-current |
|
9,513 |
|
|
|
9,513 |
|
Other current liabilities |
|
13,772 |
|
|
|
10,890 |
|
Total current liabilities |
|
312,984 |
|
|
|
276,613 |
|
|
|
|
|
||||
Lease liability obligation-operating leases-non-current |
|
762 |
|
|
|
955 |
|
Lease liability obligation-finance leases-non-current |
|
228 |
|
|
|
193 |
|
Deferred tax liabilities |
|
2,201 |
|
|
|
2,880 |
|
Deferred revenue-non-current |
|
162,471 |
|
|
|
167,227 |
|
Total Liabilities |
|
478,646 |
|
|
|
447,868 |
|
|
|
|
|
||||
Commitment and contingencies (Note 15) |
|
|
|
||||
|
|
|
|
||||
Mezzanine Equity: |
|
|
|
||||
Series A convertible preferred shares, |
|
824,488 |
|
|
|
824,488 |
|
|
|
|
|
||||
Stockholders’ Equity: |
|
|
|
||||
Common stock, |
|
78 |
|
|
|
77 |
|
Additional paid-in capital |
|
286,173 |
|
|
|
276,717 |
|
Accumulated other comprehensive loss |
|
(2,363 |
) |
|
|
(701 |
) |
Retained earnings (accumulated deficit) |
|
131,866 |
|
|
|
(12,053 |
) |
Total Stockholders’ Equity |
|
415,754 |
|
|
|
264,040 |
|
Total Liabilities, Mezzanine Equity and Stockholders’ Equity |
$ |
1,718,888 |
|
|
$ |
1,536,396 |
|
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (In thousands, except per share amounts) (Unaudited) |
|||||||||||||||
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||||
Revenue |
$ |
401,977 |
|
|
$ |
325,883 |
|
|
$ |
757,685 |
|
|
$ |
585,822 |
|
Cost of revenue |
|
192,879 |
|
|
|
166,889 |
|
|
|
366,380 |
|
|
|
313,010 |
|
Gross profit |
|
209,098 |
|
|
|
158,994 |
|
|
|
391,305 |
|
|
|
272,812 |
|
Selling, general and administrative expenses |
|
114,850 |
|
|
|
94,181 |
|
|
|
213,867 |
|
|
|
163,086 |
|
Income from operations |
|
94,248 |
|
|
|
64,813 |
|
|
|
177,438 |
|
|
|
109,726 |
|
|
|
|
|
|
|
|
|
||||||||
Other income (expense): |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Interest income on note receivable |
|
— |
|
|
|
28 |
|
|
|
28 |
|
|
|
73 |
|
Interest income, net |
|
10,647 |
|
|
|
5,545 |
|
|
|
20,259 |
|
|
|
10,469 |
|
Foreign exchange loss |
|
(264 |
) |
|
|
(931 |
) |
|
|
(633 |
) |
|
|
(1,049 |
) |
Total other income |
|
10,383 |
|
|
|
4,642 |
|
|
|
19,654 |
|
|
|
9,493 |
|
|
|
|
|
|
|
|
|
||||||||
Net income before provision for income taxes |
|
104,631 |
|
|
|
69,455 |
|
|
|
197,092 |
|
|
|
119,219 |
|
|
|
|
|
|
|
|
|
||||||||
Provision for income taxes |
|
(24,848 |
) |
|
|
(17,946 |
) |
|
|
(39,498 |
) |
|
|
(26,483 |
) |
Net income |
$ |
79,783 |
|
|
$ |
51,509 |
|
|
$ |
157,594 |
|
|
$ |
92,736 |
|
|
|
|
|
|
|
|
|
||||||||
Dividends on Series A convertible preferred stock |
|
(6,838 |
) |
|
|
(6,856 |
) |
|
|
(13,675 |
) |
|
|
(13,637 |
) |
Income allocated to participating preferred stock |
|
(6,289 |
) |
|
|
(3,890 |
) |
|
|
(12,417 |
) |
|
|
(6,898 |
) |
Net income attributable to common stockholders |
$ |
66,656 |
|
|
$ |
40,763 |
|
|
$ |
131,502 |
|
|
$ |
72,201 |
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive (loss) income: |
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments, net of income tax |
|
(308 |
) |
|
|
(590 |
) |
|
|
(1,662 |
) |
|
|
4 |
|
Comprehensive income |
$ |
66,348 |
|
|
$ |
40,173 |
|
|
$ |
129,840 |
|
|
$ |
72,205 |
|
|
|
|
|
|
|
|
|
||||||||
*Earnings per share: |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.29 |
|
|
$ |
0.18 |
|
|
$ |
0.56 |
|
|
$ |
0.31 |
|
Dilutive |
$ |
0.28 |
|
|
$ |
0.17 |
|
|
$ |
0.55 |
|
|
$ |
0.31 |
|
*Please refer to Note 3 in the Company’s Quarterly Report on Form 10-Q for the period ended |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Reconciliation of GAAP net income to non-GAAP adjusted EBITDA |
|||||||||||||||
|
Three months ended
|
|
Six months ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net income (GAAP measure) |
$ |
79,783 |
|
|
$ |
51,509 |
|
|
$ |
157,594 |
|
|
$ |
92,736 |
|
Add back/(Deduct): |
|
|
|
|
|
|
|
||||||||
Net interest income |
|
(10,647 |
) |
|
|
(5,573 |
) |
|
|
(20,287 |
) |
|
|
(10,542 |
) |
Provision for income taxes |
|
24,848 |
|
|
|
17,946 |
|
|
|
39,498 |
|
|
|
26,483 |
|
Depreciation and amortization expense |
|
1,418 |
|
|
|
698 |
|
|
|
2,648 |
|
|
|
1,246 |
|
Non-GAAP EBITDA |
|
95,402 |
|
|
|
64,580 |
|
|
|
179,453 |
|
|
|
109,923 |
|
Stock-based compensation1 |
|
4,746 |
|
|
|
5,735 |
|
|
|
8,309 |
|
|
|
11,242 |
|
Foreign exchange |
|
264 |
|
|
|
931 |
|
|
|
633 |
|
|
|
1,049 |
|
Distributor Termination2 |
|
— |
|
|
|
(1,007 |
) |
|
|
— |
|
|
|
(3,241 |
) |
Legal Settlement Costs3 |
|
— |
|
|
|
7,900 |
|
|
|
— |
|
|
|
7,900 |
|
Non-GAAP Adjusted EBITDA |
$ |
100,412 |
|
|
$ |
78,139 |
|
|
$ |
188,395 |
|
|
$ |
126,873 |
|
___________________________
1Selling, general and administrative expenses related to employee non-cash stock-based compensation expense. Stock-based compensation expense consists of non-cash charges for the estimated fair value of unvested restricted share unit and stock option awards granted to employees and directors. The Company believes that the exclusion provides a more accurate comparison of operating results and is useful to investors to understand the impact that stock-based compensation expense has on its operating results. |
22023 distributor termination represents reversals of accrued termination payments. The unused funds designated for termination expense payments to legacy distributors were reimbursed to Pepsi for the quarter ended |
32023 Legal class action settlement pertained to the McCallion vs |
USE OF NON-GAAP MEASURES
Celsius defines Adjusted EBITDA as net income before net interest income, income tax expense (benefit), and depreciation and amortization expense, further adjusted by excluding stock-based compensation expense, foreign exchange gains or losses, distributor termination fees, legal settlement costs and certain impairment charges. Adjusted EBITDA is a non-GAAP financial measure.
Celsius uses Adjusted EBITDA for operational and financial decision-making and believes these measures are useful in evaluating its performance because they eliminate certain items that management does not consider indicators of Celsius’ operating performance. Adjusted EBITDA may also be used by many of Celsius’ investors, securities analysts, and other interested parties in evaluating its operational and financial performance across reporting periods. Celsius believes that the presentation of Adjusted EBITDA provides useful information to investors by allowing an understanding of measures that it uses internally for operational decision-making, budgeting and assessing operating performance.
Adjusted EBITDA is not a recognized term under GAAP and should not be considered as a substitute for net income or any other financial measure presented in accordance with GAAP. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for analysis of Celsius’ results as reported under GAAP. Celsius strongly encourages investors to review its financial statements and publicly filed reports in their entirety and not to rely on any single financial measure.
Because non-GAAP financial measures are not standardized, Adjusted EBITDA, as defined by Celsius, may not be comparable to similarly titled measures reported by other companies. It therefore may not be possible to compare Celsius’ use of these non-GAAP financial measures with those used by other companies.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240806461910/en/
Investors: investorrelations@celsius.com
Press: press@celsius.com
Source: