-- >>> Reed's Inc. Announces Year-End 2012 Results
Press Release: Reed's Inc http://finance.yahoo.com/news/reeds-inc-announces-end-2012-203534782.html
LOS ANGELES, CA--(Marketwire - Mar 25, 2013) - Reed's, Inc. ( NYSE MKT : REED ), maker of the top-selling sodas in natural food stores nationwide, today announced the financial results for its fiscal year ending December 31, 2012.
Financial Highlights for the Quarter:
•Revenues increased 20% to $30 million in 2012, compared to 2011.
•Gross profit increased 23% to $9.1 million in 2012.
•Earnings before non-cash items and finance costs (modified EBITDA) increased to $1 million during 2012. (See EBITDA table at end of this release for further non-GAAP information).
•Net loss for the 2012 fiscal year was $524,000 compared to a loss of $941,000 a year earlier.
•Working capital at December 31, 2012 was $2.3 million, as compared to $2.7 million at December 31, 2011.
•Introduced our Culture Club Kombucha in July 2012 and increased distribution into a minimum of 800+ new retailers throughout the US and into select Whole Foods.
•Volume of branded Reed's and Virgil's products shipped grew at a rate of 20% over last year
•Expanded network of DSD distribution in numerous key regions increasing sales through this distribution channel by approximately 50%.
•Expanded distributor sales by over 30% by partnering in marketing efforts and focusing on sales support for distributors.
•Secured three new private label brand contracts with some of the largest retailers in the US
"2012 represents another solid year of growth here at Reed's," stated Chris Reed, Founder and CEO at Reed's Inc. "We have introduced an entirely new product line in our Culture Club Kombucha while we also expanded sales and distribution channels for our Reed's Ginger Brew and Virgil's branded products. Our EBITDA positive results have enabled us to fund our product rollouts and increased promotional spend without the requirement of additional equity or debt financing. We expect 2013 to be a great year."
James Linesch, Chief Financial Officer, stated, "Our strong business model is producing continually improving results in key areas. Our branded product revenues continue to increase at strong organic growth rates, while we also improved our gross margins. During 2012, our direct gross margin percentage, before promotional discounts, improved by an average of about 2%. Recurring general & administrative costs, before one-time costs, increased by less than 10% in 2012 while sales and gross profit contribution increased at over twice that rate, indicating improved economies of scale. Sales and marketing costs in 2012 were approximately 10% of net revenues, the same as in 2011. Our organizational structure is healthy and we have excellent brands that we are promoting in effective ways.
Linesch continued, "Our fourth quarter losses were primarily due to continued production challenges on our kombucha, resulting in higher unallocated plant costs, and to lighter than expected private label revenues from one customer. We have addressed the production issues surrounding our kombucha in our current quarter and we anticipate increased margin contribution going forward. Our underlying business is stronger than ever, however, and we feel that we have laid the foundation for improved financial performance in 2013."
The Company will conduct a conference call @ 4:15PM EDT on March 25th to discuss its 2012 fiscal year end results and outlook for the future. To participate in the call, please dial the following number 5 to 10 minutes prior to the scheduled call time (866) 578-1005. International callers should dial (713) 481-0091.
A replay will be available within a few days after the meeting in the investor relations section of the Company's website at: http://www.reedsinc.com/investors/
About Reed's, Inc.
Reed's, Inc. makes the top-selling natural sodas in the natural foods industry sold in over 13,000 natural food markets and supermarkets nationwide. Its six award-winning non-alcoholic Ginger Brews are unique in the beverage industry, being brewed, not manufactured and using fresh ginger, spices and fruits in a brewing process that predates commercial soft drinks. The Company owns the top-selling root beer line in natural foods, the Virgil's Root Beer product line, and a top-selling cola line in natural foods, the China Cola product line. In 2012, the Company launched Reed's Culture Club Kombucha line of organic live beverages. Other product lines include: Reed's Ginger Candies and Reed's Ginger Ice Creams. In 2009, Reed's started producing private label natural beverages for select national chains. Reed's products are sold through specialty gourmet and natural food stores, mainstream supermarket chains, retail stores and restaurants nationwide, and in Canada, as well as through private label relationships with major supermarket chains.