Monster Beverage Corporation (NASDAQ: MNST) today reported
financial results for the three- and six-months ended June 30,
2023.
Second Quarter Results
Net sales for the 2023 second quarter increased 12.1 percent to
$1.85 billion, from $1.66 billion in the same period last year. Net
changes in foreign currency exchange rates had an unfavorable
impact on net sales for the 2023 second quarter of $38.4 million.
Net sales on a foreign currency adjusted basis increased 14.4
percent in the 2023 second quarter.
Net sales for the Company’s Monster Energy® Drinks segment,
which primarily includes the Company’s Monster Energy® drinks,
Reign Total Body Fuel® high performance energy drinks and Reign
Storm® total wellness energy drinks, increased 9.7 percent to $1.69
billion for the 2023 second quarter, from $1.54 billion for the
2022 second quarter. Net changes in foreign currency exchange rates
had an unfavorable impact on net sales for the Monster Energy®
Drinks segment of approximately $36.3 million for the 2023 second
quarter. Net sales on a foreign currency adjusted basis for the
Monster Energy® Drinks segment increased 12.1 percent in the 2023
second quarter.
Net sales for the Company’s Strategic Brands segment, which
primarily includes the various energy drink brands acquired from
The Coca-Cola Company, as well as the Company’s affordable energy
brands, increased 26.0 percent to $99.7 million for the 2023 second
quarter, from $79.1 million in the 2022 second quarter. Net changes
in foreign currency exchange rates had an unfavorable impact on net
sales for the Strategic Brands segment of approximately $2.1
million for the 2023 second quarter. Net sales on a foreign
currency adjusted basis for the Strategic Brands segment increased
28.7 percent in the 2023 second quarter.
Net sales for the Alcohol Brands segment, which is comprised of
The Beast UnleashedTM, as well as the various craft beers and hard
seltzers purchased as part of the CANarchy transaction on February
17, 2022, increased 88.2 percent to $61.1 million for the 2023
second quarter, from $32.4 million in the 2022 second quarter.
Net sales for the Company’s Other segment, which primarily
includes certain products of American Fruits and Flavors, LLC, a
wholly owned subsidiary of the Company, sold to independent
third-party customers (the “AFF Third-Party Products”), increased
22.2 percent to $7.3 million for the 2023 second quarter, from $6.0
million in the 2022 second quarter.
Net sales to customers outside the United States increased 10.2
percent to $715.4 million in the 2023 second quarter, from $649.0
million in the 2022 second quarter. Such sales were approximately
39 percent in both the 2023 and 2022 second quarters. Net sales to
customers outside the United States, on a foreign currency adjusted
basis, increased 16.1 percent in the 2023 second quarter.
Gross profit as a percentage of net sales for the 2023 second
quarter was 52.5 percent, compared with 47.1 percent in the 2022
second quarter. The increase in gross profit as a percentage of net
sales was primarily the result of pricing actions, decreased
freight-in costs and decreased aluminum can costs.
Operating expenses for the 2023 second quarter were $450.4
million, compared with $406.9 million in the 2022 second quarter.
Operating expenses as a percentage of net sales for the 2023 second
quarter were 24.3 percent, compared with 24.6 percent in the 2022
second quarter.
Distribution expenses for the 2023 second quarter were $82.0
million, or 4.4 percent of net sales, compared with $87.9 million,
or 5.3 percent of net sales, in the 2022 second quarter.
Selling expenses for the 2023 second quarter were $172.6
million, or 9.3 percent of net sales, compared with $150.4 million,
or 9.1 percent of net sales, in the 2022 second quarter.
General and administrative expenses for the 2023 second quarter
were $195.8 million, or 10.6 percent of net sales, compared with
$168.7 million, or 10.2 percent of net sales, for the 2022 second
quarter. Stock-based compensation was $18.6 million for the 2023
second quarter, compared with $16.3 million in the 2022 second
quarter.
Operating income for the 2023 second quarter was $523.8 million,
compared with $373.0 million in the 2022 second quarter.
The effective tax rate for the 2023 second quarter was 23.2
percent, compared with 25.3 percent in the 2022 second quarter.
Net income for the 2023 second quarter increased 51.4 percent to
$413.9 million, from $273.4 million in the 2022 second quarter. Net
income per diluted share for the 2023 second quarter increased 52.8
percent to $0.39, from $0.26 in the second quarter of 2022.
Hilton H. Schlosberg, Vice Chairman and Co-Chief Executive
Officer, said, “We are seeing sustained growth in the energy drink
market in the United States, as well as internationally. We are
pleased to report another quarter of continued revenue
growth, with record sales for our second fiscal quarter. The
quarter was again impacted by unfavorable foreign currency exchange
rates.
“Gross profit margins in the quarter improved significantly as
compared to the 2022 second quarter, primarily as a result
of pricing actions, decreased freight-in costs and decreased
aluminum can costs. As expected, promotional allowances as a
percentage of net sales for the 2023 second quarter were marginally
higher than the comparable 2022 second quarter as well as
marginally higher than the 2023 first quarter.
“Internationally, we implemented price increases in certain
markets during the 2023 second quarter, with additional price
increases planned in a number of other markets during the remainder
of the year. In certain markets, such increases are in addition to
price increases implemented in 2022.
“On July 31, 2023, we completed our purchase of Bang Energy and
are in the process of integrating this brand into our portfolio,”
Schlosberg added.
Rodney C. Sacks, Chairman and Co-Chief Executive Officer,
said, “We are pleased with our new product innovation launches
in the first half of this year. We are particularly excited
with the launch in March 2023, of Reign Storm®, positioned in the
total wellness energy category in the United States.
“During the second quarter, we continued our roll-out of our
first flavored malt beverage alcohol product, The Beast
Unleashed™, in the United States. We are pleased with the results
of the launch to date and are continuing to expand distribution
into additional markets, with the goal of being national by the end
of the year. We will be launching certain flavors of The Beast
Unleashed™ in new 24 oz. single serve cans mainly for the
convenience and gas market.
“We also plan to launch a hard iced tea extension of The Beast
Unleashed™, named Nasty Beast™ Hardcore Tea, later this year or
early next year, with a goal of national distribution in the first
half of 2024. The brand will be available in four flavors:
Original, Half & Half, Razzleberry and Green. Nasty Beast™
Hardcore Tea will be sold in a variety 12-pack and 24 oz.
single-serve cans.
“We have a robust innovative pipeline of both alcoholic and
non-alcoholic beverages,” Sacks added.
2023 Six-Months Results
Net sales for the six-months ended June 30, 2023 increased
12.0 percent to $3.55 billion, from $3.17 billion in the comparable
period last year. Net changes in foreign currency exchange rates
had an unfavorable impact of $90.4 million on net sales for the
six-months ended June 30, 2023. Net sales on a foreign currency
adjusted basis increased 14.8 percent in the six-months ended June
30, 2023.
Gross profit as a percentage of net sales for the six-months
ended June 30, 2023 was 52.7 percent, compared with 49.0
percent in the comparable period last year.
Operating expenses for the six-months ended June 30, 2023
were $863.2 million, compared with $784.1 million in the comparable
period last year.
Operating income for the six-months ended June 30, 2023
increased to $1.01 billion, from $772.4 million in the comparable
period last year.
The effective tax rate for the six-months ended June 30, 2023
was 21.7 percent, compared with 25.2 percent in the comparable
period last year.
Net income for the six-months ended June 30, 2023 increased
42.9 percent to $811.3 million, from $567.6 million in the
comparable period last year. Net income per diluted share for the
six-months ended June 30, 2023 was $0.77, compared with $0.53
in the comparable period last year.
Share Repurchase Program
No shares of the Company’s common stock were repurchased during
the 2023 second quarter under the previously authorized repurchase
programs. As of August 3, 2023, approximately $682.8 million
remained available for repurchase under the previously authorized
repurchase programs.
Bang Energy
On July 31, 2023 the Company completed its
acquisition of substantially all of the assets of Vital
Pharmaceuticals, Inc. and certain of its affiliates (collectively,
“Bang Energy”) for a purchase price of approximately $362 million,
subject to adjustments. The acquired assets include Bang Energy
beverages and a beverage production facility in Phoenix,
Arizona.
Investor Conference Call
The Company will host an investor conference call
today, August 3, 2023, at 2:00 p.m. Pacific Time (5:00 p.m. Eastern
Time). The conference call will be open to all interested investors
through a live audio web broadcast via the internet at
www.monsterbevcorp.com in the “Events & Presentations” section.
For those who are not able to listen to the live broadcast, the
call will be archived for approximately one year on the
website.
Monster Beverage Corporation
Based in Corona, California, Monster Beverage
Corporation is a holding company and conducts no operating business
except through its consolidated subsidiaries. The Company’s
subsidiaries develop and market energy drinks, including Monster
Energy® drinks, Monster Energy Ultra® energy drinks, Juice Monster®
Energy + Juice energy drinks, Java Monster® non-carbonated coffee +
energy drinks, Rehab® Monster® non-carbonated energy drinks,
Monster Hydro® non-carbonated refreshment + energy drinks, Monster
Energy® Nitro energy drinks, Reign Total Body Fuel® high
performance energy drinks, Reign Inferno® thermogenic fuel high
performance energy drinks, Reign Storm® clean energy drinks, NOS®
energy drinks, Full Throttle® energy drinks, BPM® energy drinks,
BU® energy drinks, Burn® energy drinks, Gladiator® energy drinks,
Live+® energy drinks, Mother® energy drinks, Nalu® energy drinks,
Play® and Power Play® (stylized) energy drinks, Relentless® energy
drinks, Samurai® energy drinks, Ultra Energy® drinks, Predator®
energy drinks and Fury® energy drinks. The Company’s subsidiaries
also develop and market still and sparkling waters under the
Monster Tour Water® brand name. The Company’s subsidiaries also
develop and market craft beers, hard seltzers and flavored malt
beverages under a number of brands, including Jai Alai® IPA, Dale’s
Pale Ale®, Dallas Blonde®, Wild Basin® hard seltzers and The Beast
Unleashed™. For more information visit www.monsterbevcorp.com.
Caution Concerning Forward-Looking
Statements
Certain statements made in this announcement may constitute
“forward-looking statements” within the meaning of the U.S. federal
securities laws, as amended, regarding the expectations of
management with respect to our future operating results and other
future events including revenues and profitability. The Company
cautions that these statements are based on management’s current
knowledge and expectations and are subject to certain risks and
uncertainties, many of which are outside of the control of the
Company, that could cause actual results and events to differ
materially from the statements made herein. Such risks and
uncertainties include, but are not limited to, the following: the
impact of the military conflict in Ukraine, including supply chain
disruptions, volatility in commodity prices, increased economic
uncertainty and escalating geopolitical tensions; our extensive
commercial arrangements with The Coca-Cola Company (TCCC) and, as a
result, our future performance’s substantial dependence on the
success of our relationship with TCCC; our ability to implement our
growth strategy, including expanding our business in existing and
new sectors; the inherent operational risks presented by the
alcoholic beverage industry that may not be adequately covered by
insurance or lead to litigation relating to the abuse or misuse of
our products; our ability to successfully integrate Bang Energy
businesses and assets, transition the acquired beverages to the
Company’s primary distributors, and retain and increase sales of
the acquired beverages; exposure to significant liabilities due to
litigation, legal or regulatory proceedings; intellectual property
injunctions; unanticipated litigation concerning the Company’s
products; the current uncertainty and volatility in the national
and global economy and changes in demand due to such economic
conditions; changes in consumer preferences; adverse publicity
surrounding obesity, alcohol consumption and other health concerns
related to our products, product safety and quality; activities and
strategies of competitors, including the introduction of new
products and competitive pricing and/or marketing of similar
products; changes in the price and/or availability of raw
materials; other supply issues, including the availability of
products and/or suitable production facilities including
limitations on co-packing availability including retort production;
disruption to our manufacturing facilities and operations related
to climate, labor, production difficulties, capacity limitations,
regulations or other causes; product distribution and placement
decisions by retailers; the effects of retailer and/or
bottler/distributor consolidation on our business; unilateral
decisions by bottlers/distributors, buying groups, convenience
chains, grocery chains, mass merchandisers, specialty chain stores,
e-commerce retailers, e-commerce websites, club stores and other
customers to discontinue carrying all or any of our products that
they are carrying at any time, restrict the range of our products
they carry, impose restrictions or limitations on the sale of our
products and/or the sizes of containers for our products and/or
devote less resources to the sale of our products; changes in
governmental regulation; the imposition of new and/or increased
excise sales and/or other taxes on our products; our ability to
adapt to the changing retail landscape with the rapid growth in
e-commerce retailers and e-commerce websites; the impact of
proposals to limit or restrict the sale of energy or alcohol drinks
to minors and/or persons below a specified age and/or restrict the
venues and/or the size of containers in which energy or alcohol
drinks can be sold; possible recalls of our products and/or the
consequences and costs of defective production; or our ability to
absorb, reduce or pass on to our bottlers/distributors increases in
commodity costs, including freight costs. For a more detailed
discussion of these and other risks that could affect our operating
results, see the Company’s reports filed with the Securities and
Exchange Commission, including our annual report on Form 10-K for
the year ended December 31, 2022 and our subsequently filed
quarterly report. The Company’s actual results could differ
materially from those contained in the forward-looking statements.
The Company assumes no obligation to update any forward-looking
statements, whether as a result of new information, future events
or otherwise.
(tables below)
MONSTER BEVERAGE CORPORATION AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF
INCOME AND OTHER INFORMATIONFOR THE THREE- AND
SIX-MONTHS ENDED JUNE 30, 2023 AND 2022(In
Thousands, Except Per Share Amounts) (Unaudited) |
|
Three-Months Ended |
|
Six-Months Ended |
|
June 30, |
|
June 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
Net sales¹ |
$ |
1,854,961 |
|
|
$ |
1,655,260 |
|
|
$ |
3,553,891 |
|
|
$ |
3,173,833 |
|
|
|
|
|
|
|
|
|
Cost of sales |
|
880,739 |
|
|
|
875,399 |
|
|
|
1,681,820 |
|
|
|
1,617,306 |
|
|
|
|
|
|
|
|
|
Gross profit¹ |
|
974,222 |
|
|
|
779,861 |
|
|
|
1,872,071 |
|
|
|
1,556,527 |
|
Gross profit as a percentage
of net sales |
|
52.5 |
% |
|
|
47.1 |
% |
|
|
52.7 |
% |
|
|
49.0 |
% |
|
|
|
|
|
|
|
|
Operating expenses |
|
450,417 |
|
|
|
406,910 |
|
|
|
863,201 |
|
|
|
784,088 |
|
Operating expenses as a
percentage of net sales |
|
24.3 |
% |
|
|
24.6 |
% |
|
|
24.3 |
% |
|
|
24.7 |
% |
|
|
|
|
|
|
|
|
Operating income¹ |
|
523,805 |
|
|
|
372,951 |
|
|
|
1,008,870 |
|
|
|
772,439 |
|
Operating income as a
percentage of net sales |
|
28.2 |
% |
|
|
22.5 |
% |
|
|
28.4 |
% |
|
|
24.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other income
(expense), net |
|
15,159 |
|
|
|
(6,781 |
) |
|
|
27,653 |
|
|
|
(14,080 |
) |
|
|
|
|
|
|
|
|
Income before provision for
income taxes¹ |
|
538,964 |
|
|
|
366,170 |
|
|
|
1,036,523 |
|
|
|
758,359 |
|
|
|
|
|
|
|
|
|
Provision for income
taxes |
|
125,093 |
|
|
|
92,810 |
|
|
|
225,208 |
|
|
|
190,796 |
|
Income taxes as a percentage
of income before taxes |
|
23.2 |
% |
|
|
25.3 |
% |
|
|
21.7 |
% |
|
|
25.2 |
% |
|
|
|
|
|
|
|
|
Net income |
$ |
413,871 |
|
|
$ |
273,360 |
|
|
$ |
811,315 |
|
|
$ |
567,563 |
|
Net income as a percentage of
net sales |
|
22.3 |
% |
|
|
16.5 |
% |
|
|
22.8 |
% |
|
|
17.9 |
% |
|
|
|
|
|
|
|
|
Net income per common
share: |
|
|
|
|
|
|
|
Basic |
$ |
0.40 |
|
|
$ |
0.26 |
|
|
$ |
0.78 |
|
|
$ |
0.54 |
|
Diluted |
$ |
0.39 |
|
|
$ |
0.26 |
|
|
$ |
0.77 |
|
|
$ |
0.53 |
|
|
|
|
|
|
|
|
|
Weighted average number of
shares of common stock and common stock equivalents: |
|
|
|
|
|
|
|
Basic |
|
1,047,065 |
|
|
|
1,057,233 |
|
|
|
1,045,993 |
|
|
|
1,058,017 |
|
Diluted |
|
1,060,093 |
|
|
|
1,069,622 |
|
|
|
1,059,667 |
|
|
|
1,070,418 |
|
|
|
|
|
|
|
|
|
Energy drink case sales (in
thousands) (in 192-ounce case equivalents) |
|
198,406 |
|
|
|
184,197 |
|
|
|
380,850 |
|
|
|
352,990 |
|
Average net sales per
case2 |
$ |
9.00 |
|
|
$ |
8.78 |
|
|
$ |
9.02 |
|
|
$ |
8.82 |
|
|
|
|
|
|
|
|
|
1Includes $10.0 million and $10.1 million for
the three-months ended June 30, 2023 and 2022, respectively,
related to the recognition of deferred revenue. Includes $19.9
million and $20.1 million for the six-months ended June 30, 2023
and 2022, respectively, related to the recognition of deferred
revenue.
2Excludes Alcohol Brands segment net sales of $61.1 million and
$32.4 million for the three-months ended June 30, 2023 and 2022,
respectively, as these sales do not have unit case equivalents.
Excludes Other segment net sales of $7.3 million and $6.0 million
for the three-months ended June 30, 2023 and 2022, respectively,
comprised primarily of net sales of AFF Third-Party Products to
independent third-party customers, as these sales do not have unit
case equivalents. Excludes Alcohol Brands segment net sales of
$107.4 million and $47.7 million for the six-months ended June 30,
2023 and 2022, respectively, as these sales do not have unit case
equivalents. Excludes Other segment net sales of $11.9 million for
both the six-months ended June 30, 2023 and 2022, respectively,
comprised primarily of net sales of AFF Third-Party Products to
independent third-party customers, as these sales do not have unit
case equivalents.
MONSTER BEVERAGE CORPORATION AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE
SHEETSAS OF JUNE 30, 2023 AND DECEMBER 31,
2022(In Thousands, Except Par Value)
(Unaudited) |
|
|
June 30,2023 |
|
December 31,2022 |
ASSETS |
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
Cash and cash equivalents |
|
$ |
1,869,774 |
|
|
$ |
1,307,141 |
|
Short-term investments |
|
|
1,417,239 |
|
|
|
1,362,314 |
|
Accounts receivable, net |
|
|
1,333,004 |
|
|
|
1,016,203 |
|
Inventories |
|
|
846,812 |
|
|
|
935,631 |
|
Prepaid expenses and other
current assets |
|
|
148,750 |
|
|
|
109,823 |
|
Prepaid income taxes |
|
|
38,534 |
|
|
|
33,785 |
|
Total current assets |
|
|
5,654,113 |
|
|
|
4,764,897 |
|
|
|
|
|
|
INVESTMENTS |
|
|
62,248 |
|
|
|
61,443 |
|
PROPERTY AND EQUIPMENT,
net |
|
|
576,645 |
|
|
|
516,897 |
|
DEFERRED INCOME TAXES |
|
|
177,039 |
|
|
|
177,039 |
|
GOODWILL |
|
|
1,417,941 |
|
|
|
1,417,941 |
|
OTHER INTANGIBLE ASSETS,
net |
|
|
1,224,100 |
|
|
|
1,220,410 |
|
OTHER ASSETS |
|
|
151,252 |
|
|
|
134,478 |
|
Total Assets |
|
$ |
9,263,338 |
|
|
$ |
8,293,105 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
Accounts payable |
|
$ |
568,613 |
|
|
$ |
444,265 |
|
Accrued liabilities |
|
|
198,656 |
|
|
|
172,991 |
|
Accrued promotional
allowances |
|
|
283,647 |
|
|
|
255,631 |
|
Deferred revenue |
|
|
42,765 |
|
|
|
43,311 |
|
Accrued compensation |
|
|
56,195 |
|
|
|
72,463 |
|
Income taxes payable |
|
|
12,704 |
|
|
|
13,317 |
|
Total current liabilities |
|
|
1,162,580 |
|
|
|
1,001,978 |
|
|
|
|
|
|
DEFERRED REVENUE |
|
|
215,039 |
|
|
|
223,800 |
|
|
|
|
|
|
OTHER LIABILITIES |
|
|
44,255 |
|
|
|
42,286 |
|
|
|
|
|
|
STOCKHOLDERS' EQUITY: |
|
|
|
|
Common stock -
$0.005 par value; 5,000,000 shares authorized;1,118,269 shares
issued and 1,047,485 shares outstanding as of June 30,
2023;1,283,688 shares issued and 1,044,600 shares outstanding as of
December 31, 2022 |
|
5,591 |
|
|
|
6,418 |
|
Additional paid-in
capital |
|
|
4,869,791 |
|
|
|
4,776,804 |
|
Retained earnings |
|
|
5,120,063 |
|
|
|
9,001,173 |
|
Accumulated other
comprehensive loss |
|
|
(155,725 |
) |
|
|
(159,073 |
) |
Common stock in
treasury, at cost; 70,784 shares and 239,088 shares as of
June 30, 2023 and December 31, 2022,
respectively |
|
(1,998,256 |
) |
|
|
(6,600,281 |
) |
Total stockholders' equity |
|
|
7,841,464 |
|
|
|
7,025,041 |
|
Total Liabilities and Stockholders’ Equity |
|
$ |
9,263,338 |
|
|
$ |
8,293,105 |
|
|
CONTACTS: |
Rodney C. SacksChairman and Co-Chief Executive Officer(951)
739-6200 |
|
|
|
Hilton H. SchlosbergVice Chairman
and Co-Chief Executive Officer(951) 739-6200 |
|
|
|
Roger S. Pondel / Judy
LinPondelWilkinson Inc.(310) 279-5980 |
Grafico Azioni Monster Beverage (NASDAQ:MNST)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni Monster Beverage (NASDAQ:MNST)
Storico
Da Giu 2023 a Giu 2024