Celsius Holdings Reports First Quarter 2024 Financial Results
Celsius Holdings, maker of CELSIUS® energy drink, reported record first quarter 2024 financial results with revenue of $355.7 million (up 37% YoY), gross profit of $182.2 million (up 60% YoY), and diluted EPS of $0.27 (up 108% YoY). The company's North American and international sales both saw significant growth, driving overall revenue increase. Celsius also achieved a 51% gross margin and an 81% increase in Adjusted EBITDA compared to the previous year.
Record first quarter revenue of $355.7 million, up 37% year over year.
First quarter gross profit of $182.2 million, up 60% year over year.
First quarter diluted EPS of $0.27, up 108% year over year.
North American sales increased by 37% to $339.5 million.
International sales grew by 43% to $16.2 million.
Gross margin improved to 51% for the first quarter.
Net income attributed to common shareholders rose by 106%.
Adjusted EBITDA increased by 81% to $88.0 million.
Ongoing inventory fluctuations may impact subsequent quarters.
Changes in days on hand inventory affected revenue by approximately $20 million.
Retail sales growth may face challenges due to inventory movements.
Insights
Celsius Holdings' robust financials, with a 37% increase in revenue and an even more impressive 60% increase in gross profit, reflect a strong market position and effective cost management. Such numbers typically indicate not just efficiency gains but potential pricing power and successful product mix optimization. A compelling 108% increase in diluted EPS showcases substantial bottom-line growth, which is a critical indicator for investors assessing company performance and future dividend prospects.
The company's North American market, contributing a significant portion of the revenue increase, suggests solid brand acceptance and market penetration. However, investors should consider the impact of inventory fluctuations from the largest distributor on future revenues. The 72.1% retail sales growth in the U.S. is a strong sign of consumer demand, but dependency on a single distributor could pose risks that warrant monitoring.
International expansion, with sales up 43% and diversification into new markets like Australia, France, Ireland, New Zealand and the UK present opportunities for revenue streams diversification, albeit with inherent risks of new market entry such as regulatory hurdles and localization challenges.
The strategic importance of Celsius' 11.5% category share gain and its 9.6% quarter-over-quarter sales growth in an otherwise declining market segment cannot be understated. This is particularly notable as it exhibits the brand's resilience against market headwinds and its capacity to capture consumer interest amidst stiff competition. Sales growth in the club channel and on Amazon, at 36% and 30%, respectively, also demonstrate the effectiveness of Celsius' omnichannel distribution approach.
Product innovation and marketing, highlighted by the introduction of new flavors and the success of CELSIUS Essentials, are key growth drivers that align with consumer trends towards healthier and more diverse beverage options. The product's visual impact in stores, described as 'powerful in-store billboards,' reflects a deep understanding of branding's role in consumer purchase behavior. Yet, there's always the risk of innovation saturation, where constant new flavors may overwhelm rather than attract consumers, which requires careful market analysis.
A significant increase in gross margins, attributed to reduced freight and material costs, suggest effective supply chain management and potentially favorable commodity markets. The mention of 'accelerated benefit from raw materials pricing' may indicate a beneficial procurement strategy or favorable market conditions that may not be sustainable long-term. Investors with an interest in supply chain dynamics should note the discussion on changes in inventory days on hand by Celsius' largest customer, which could have implications for supply chain efficiency and working capital management moving onwards.
Additionally, the impact of ongoing retailer resets, pegged as a driver for future growth, raises questions about the sustainability of inventory levels and the need for continuous supply chain optimization to handle increased product availability. It's important to consider the scalability of their logistics infrastructure to support expected growth, especially within international markets.
Record first quarter revenue of
Record first quarter gross profit of
First quarter diluted EPS of
Summary Financials | 1Q 2024 | 1Q 2023 | Change | |||
(Millions except for | ||||||
Revenue | 37 % | |||||
N. America | 37 % | |||||
International | 43 % | |||||
Gross Margin | 51.2 % | 43.8 % | +740 BPS | |||
Net Income | 89 % | |||||
Net Income att. to | 106 % | |||||
Diluted EPS | 108 % | |||||
Adjusted EBITDA* | 81 % |
John Fieldly, Chairman and CEO of Celsius Holdings, Inc., said: "Celsius reported its best first quarter ever driving record revenue and contributing
Jarrod Langhans, Chief Financial Officer of Celsius Holdings, Inc., said: "Celsius' first quarter revenue of
*The company reports financial results in accordance with generally accepted accounting principles in
FINANCIAL HIGHLIGHTS FOR THE FIRST QUARTER 2024
Revenue for the first quarter increased
International sales of
Gross profit for the first quarter of 2024 increased
Diluted earnings per share for the first quarter increased
BUSINESS OPERATIONS & COMPANY HIGHLIGHTS
Share Growth
Celsius held an
Average SKUs per retailer increased in the first quarter of 2024 to 20.6 from 13.5 in the prior-year period7. TDPs for the quarter grew
We estimate that retailers' spring shelf resets were approximately one-third complete as of March 31, and once concluded, we are expecting our best shelf space gains in company history. The importance of these space increases and placement improvements cannot be overstated. The visual impact of multiple, full shelves of cold Celsius in convenience store coolers and on grocery shelves is a powerful in-store billboard and showcases more of the Celsius product portfolio. The full effect of shelf space gains is expected to be reflected in scanner data beginning in July 2024.
Growth Drivers
Club channel sales in the quarter ended March 31, 2024, increased
Celsius sales on Amazon increased
Case volume in the food service channel increased
Innovation & Marketing
Sales of CELSIUS Essentials continue to exceed expectations and have reached
Celsius introduced new, refreshing 12-ounce flavors in the first quarter, including: CELSIUS Blue Razz Lemonade, CELSIUS Raspberry Peach, CELSIUS Astro Vibe, CELSIUS Galaxy Vibe, as well as new variety packs.
CELSIUS On The Go powders reached the #1 position in the energy powder category in the first quarter of 2024 and have increased category share by 1.7 points since January 2024 to
Celsius hosted high-profile influencers and celebrities during the first weekend of the Coachella Valley Music & Arts Festival at the Celsius Cosmic Desert event featuring the Celsius Space Vibe Trilogy (CELSIUS Cosmic Vibe, CELSIUS Astro Vibe, CELSIUS Galaxy Vibe) with exclusive performances by artists T-Pain, Two Friends, DJ Xandra and more.
International Expansion
Sales in
Celsius in the first quarter announced plans to expand its sales and distribution into
CONFERENCE CALL
Conference Call
Management will host a conference call and webcast at 10 a.m. EDT on Tuesday, May 7, 2024, to discuss the company's first quarter results with the investment community. All participants must pre-register to join the Celsius Holdings, Inc. First Quarter 2024 Earnings Conference Call using the participant registration link https://registrations.events/direct/Q4I739144810. A unique registration ID and access details will be provided after registration.
Participants who do not pre-register online may dial in using the phone numbers below and request conference ID 73914 or the Celsius Holdings, Inc. First Quarter 2024 Earnings Conference Call for admittance into the conference.
Webcast
Participants who wish to join the Celsius Holdings, Inc. First Quarter 2024 Earnings Webcast must register at
https://events.q4inc.com/attendee/221116293
Replay of the conference can be accessed through the webcast link
https://events.q4inc.com/attendee/221116293
About Celsius Holdings, Inc.
Celsius Holdings, Inc. (Nasdaq: CELH) is the maker of energy drink brand CELSIUS®, a lifestyle energy drink born in fitness and a pioneer in the rapidly growing energy category. For more information, please visit www.celsiusholdings.com.
Contacts
Paul Wiseman
Investor Contact: investorrelations@celsius.com
Press Contact: press@celsius.com
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 any 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 Securities and Exchange Commission (the "SEC") required filings and the requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and the rules and regulations adopted under that Section; and other risks and uncertainties discussed in the reports Celsius Holdings has filed previously with the SEC, such as its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Forward-looking statements speak only as of the date the statements were made. Celsius Holdings does not undertake any obligation to update forward-looking information, except to the extent required by applicable law.
CELSIUS HOLDINGS, INC. - FINANCIAL TABLES | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(In thousands, except par value) | |||
(Unaudited) | |||
March 31, | December 31, | ||
ASSETS | |||
Current assets: | |||
Cash and cash equivalents | $ 879,498 | $ 755,981 | |
Accounts receivable-net | 200,117 | 183,703 | |
Note receivable-current-net | 2,259 | 2,318 | |
Inventories-net | 197,504 | 229,275 | |
Prepaid expenses and other current assets | 21,523 | 19,503 | |
Deferred other costs-current | 14,124 | 14,124 | |
Total current assets | 1,315,025 | 1,204,904 | |
Property and equipment-net | 28,350 | 24,868 | |
Deferred tax assets | 22,437 | 29,518 | |
Right of use assets-operating leases | 1,688 | 1,957 | |
Right of use assets-finance leases | 263 | 208 | |
Other long-term assets | 7,963 | 291 | |
Deferred other costs-non-current | 244,807 | 248,338 | |
Intangibles-net | 11,741 | 12,139 | |
Goodwill | 13,866 | 14,173 | |
Total Assets | $ 1,646,140 | $ 1,536,396 | |
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY | |||
Current liabilities: | |||
Accounts payable | $ 40,196 | $ 42,840 | |
Accrued expenses | 63,871 | 62,120 | |
Income taxes payable | 58,619 | 50,424 | |
Accrued promotional allowance | 129,201 | 99,787 | |
Lease liability obligation-operating leases | 821 | 980 | |
Lease liability obligation-finance leases | 61 | 59 | |
Deferred revenue-current | 9,513 | 9,513 | |
Other current liabilities | 12,987 | 10,890 | |
Total current liabilities | 315,269 | 276,613 | |
Lease liability obligation-operating leases | 850 | 955 | |
Lease liability obligation-finance leases | 245 | 193 | |
Deferred tax liability | 2,248 | 2,880 | |
Deferred revenue-non-current | 164,849 | 167,227 | |
Total Liabilities | 483,461 | 447,868 | |
Commitment and contingencies | |||
Mezzanine Equity: | |||
Series A convertible preferred shares, | 824,488 | 824,488 | |
Stockholders' Equity: | |||
Common stock, | 78 | 77 | |
Additional paid-in capital | 281,247 | 276,717 | |
Accumulated other comprehensive loss | (2,055) | (701) | |
Retained earnings (accumulated deficit) | 58,921 | (12,053) | |
Total Stockholders' Equity | 338,191 | 264,040 | |
Total Liabilities, Mezzanine Equity and Stockholders' Equity | $ 1,646,140 | $ 1,536,396 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | |||
(In thousands, except per share amounts) | |||
(Unaudited) | |||
For the Three Months Ended | |||
2024 | 2023 | ||
Revenue | $ 355,708 | $ 259,939 | |
Cost of revenue | 173,501 | 146,121 | |
Gross profit | 182,207 | 113,818 | |
Selling, general and administrative expenses | 99,017 | 68,905 | |
Income (loss) from operations | 83,190 | 44,913 | |
Other income (expense): | |||
Interest income on note receivable | 28 | 45 | |
Interest income | 9,612 | 4,924 | |
Foreign exchange loss | (369) | (118) | |
Total other income | 9,271 | 4,851 | |
Net income before income taxes | 92,461 | 49,764 | |
Income tax expense | (14,650) | (8,537) | |
Net income | $ 77,811 | $ 41,227 | |
Dividends on Series A preferred shares | (6,837) | (6,781) | |
Income allocated to participating preferred shares | (6,128) | (2,934) | |
Net income attributable to common | $ 64,846 | $ 31,512 | |
Other comprehensive income (loss): | |||
Foreign currency translation (loss) gain, net of | (1,354) | 594 | |
Comprehensive income (loss) | $ 63,492 | $ 32,106 | |
*Earnings per share: | |||
Basic | $ 0.28 | $ 0.14 | |
Dilutive | $ 0.27 | $ 0.13 | |
*Please refer to Note 3 in the Company's Quarterly Report on Form 10-Q for the period ended March 31, 2024, for Earnings per Share reconciliations.
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||
Reconciliation of GAAP net income to non-GAAP adjusted EBITDA | |||
Three months ended | |||
2024 | 2023 | ||
Net income (GAAP measure) | $ 77,811 | $ 41,227 | |
Add back/(Deduct): | |||
Net interest income | (9,640) | (4,969) | |
Income tax expense | 14,650 | 8,537 | |
Depreciation and amortization expense | 1,229 | 549 | |
Non-GAAP EBITDA | 84,050 | 45,344 | |
Stock-based compensation13 | 3,563 | 5,507 | |
Foreign exchange | 369 | 118 | |
Distributor Termination14 | — | (2,234) | |
Non-GAAP Adjusted EBITDA | $ 87,982 | $ 48,735 | |
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.
____________________ | |
1 | Circana Total US MULOC L13W Ended 3/31/24, RTD Energy |
2 | Circana Total US MULOC L4W Ended 4/14/24, RTD Energy |
3 | Circana Total US MULOC L13W ended 3/31/24, RTD Energy |
4 | Circana Total US MULOC ended 4/21/24, RTD Energy |
5 | Circana Total US MULOC L4W ended 4/14/24, RTD Energy |
6 | Circana Total US MULOC RTD energy weekly sugar free dollar share from 4/11/21 – 3/31/24 |
7 | Circana Total US MULOC L13W ended 3/31/24, RTD Energy |
8 | Circana Total US MULOC L13W ended 3/31/24, RTD Energy |
9 | Stackline Total US Energy Drink Category L14W ended 3/30/24 |
10 | Circana Total US MULOC L4W ended 3/24/24, RTD Energy |
11 | Circana Total US MULOC L4W ended 3/24/24, RTD Energy |
12 | Circana Total US MULOC L4W ended 3/24/24, Energy Powders |
13 | Selling, 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. |
14 | 2023 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 June 30, 2023. |
View original content to download multimedia:https://www.prnewswire.com/news-releases/celsius-holdings-reports-first-quarter-2024-financial-results-302137431.html
SOURCE Celsius Holdings, Inc.
FAQ
What was Celsius Holdings' revenue in the first quarter of 2024?
How much did Celsius Holdings' gross profit increase in the first quarter of 2024?
What was Celsius Holdings' diluted EPS in the first quarter of 2024?
In which countries did Celsius Holdings see sales growth in the first quarter of 2024?
How much did Celsius Holdings' Adjusted EBITDA increase by in the first quarter of 2024?
