Monster Beverage Corporation (NASDAQ: MNST) today reported
financial results for the three- and nine-months ended September
30, 2024.
Items Impacting Profitability Items impacting
profitability in the 2024 third quarter: Gross profit for the 2024
third quarter was adversely impacted by an increase in inventory
reserves due to excess inventory levels in the Alcohol Brands
segment of $10.6 million (the “Alcohol Brands Inventory Reserves”).
Operating expenses for the 2024 third quarter were adversely
impacted by a $16.7 million provision and $1.2 million of Company
incurred legal expenses (collectively, the “Hansen Expenses”) in
connection with an intellectual property claim brought by the
descendants of Hubert Hansen, in relation to the Company’s use of
the Hubert Hansen name prior to the transaction with the Coca-Cola
Company, which closed in 2015. Net of tax, these items adversely
impacted net income for the 2024 third quarter by $21.5 million and
net income per diluted share by $0.02 per share.
Items impacting profitability in the 2023 third quarter: On July
31, 2023, the Company completed its acquisition of substantially
all of the assets of Vital Pharmaceuticals, Inc. and its debtor
affiliates (the “Bang Transaction”). Inventory purchased as part of
the Bang Transaction was recorded at fair value (the “Bang
Inventory Step-Up”). Certain of the purchased inventory was
subsequently sold in the 2023 third quarter and was recognized
through cost of sales at fair value. As a result of the Bang
Inventory Step-Up, gross profit was adversely impacted by
approximately $7.8 million during the 2023 third quarter. During
the 2023 third quarter, in connection with the Bang Transaction,
the Company recorded a gain of $45.4 million (the “Bang Transaction
Gain”) in interest and other income (expense), net. During the
2023 third quarter, the Company incurred approximately $8.0 million
of acquisition expenses related to the Bang Transaction (the “Bang
Transaction Expenses”). Net of tax, these items positively impacted
net income for the 2023 third quarter by $22.7 million and net
income per diluted share by $0.02 per share.
The tables at the end of this press release summarize the income
statement impact of the selected items discussed above for the
three and nine-months ended September 30, 2024 and 2023. (See
“Adjusted Condensed Consolidated Statements of Income and Other
Information” and “Reconciliation of GAAP and Non-GAAP Information”
below).
Third Quarter ResultsNet sales for the 2024
third quarter increased 1.3 percent to $1.88 billion, from $1.86
billion in the comparable period last year. Net changes in foreign
currency exchange rates had an unfavorable impact on net sales for
the 2024 third quarter of $62.8 million ($26.5 million related to
Argentina). Net sales on a foreign currency adjusted basis
increased 4.7 percent (5.0 percent excluding the Alcohol Brands
segment) in the 2024 third 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, Reign Storm®
total wellness energy drinks and Bang Energy® drinks, increased 0.8
percent to $1.72 billion for the 2024 third quarter, from $1.71
billion for the 2023 third quarter. Net changes in foreign currency
exchange rates had an unfavorable impact on net sales for the
Monster Energy® Drinks segment of approximately $52.8 million for
the 2024 third quarter ($26.5 million related to Argentina). Net
sales on a foreign currency adjusted basis for the Monster Energy®
Drinks segment increased 3.9 percent in the 2024 third 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 Predator® and Fury®, increased 14.0 percent to $112.6
million for the 2024 third quarter, from $98.8 million in the 2023
third quarter. Net changes in foreign currency exchange rates had
an unfavorable impact on net sales for the Strategic Brands segment
of approximately $10.0 million for the 2024 third quarter. Net
sales on a foreign currency adjusted basis for the Strategic Brands
segment increased 24.1 percent in the 2024 third quarter.
Net sales for the Alcohol Brands segment, which is comprised of
The BeastTM, Nasty Beast™ Hard Tea, as well as various craft beers
and hard seltzers, decreased 6.0 percent to $39.8 million for the
2024 third quarter, from $42.3 million in the 2023 third quarter.
The decrease in net sales was primarily due to decreased sales by
volume of craft beers.
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, decreased 11.5 percent to $5.9 million for
the 2024 third quarter, from $6.7 million in the 2023 third
quarter.
Net sales to customers outside the United States increased 3.6
percent to $760.1 million in the 2024 third quarter, from $733.7
million in the 2023 third quarter. Such sales were approximately
40.4 percent of total net sales for the 2024 third quarter compared
with 39.5 percent in the 2023 third quarter. Net sales to customers
outside the United States, on a foreign currency adjusted basis,
increased 12.1 percent in the 2024 third quarter (8.5 percent
exclusive of Argentina’s impact).
Gross profit as a percentage of net sales for the 2024 third
quarter was 53.2 percent, compared with 53.0 percent in the 2023
third quarter. Gross profit for the 2024 third quarter was
adversely impacted by the Alcohol Brands Inventory Reserves. Gross
profit as a percentage of net sales for the 2024 third quarter,
exclusive of the Alcohol Brands Inventory Reserves was 53.7
percent. The increase in gross profit as a percentage of net sales
for the 2024 third quarter was primarily the result of lower input
costs, pricing actions in certain international markets and the
Bang Inventory Step-Up (included in the comparative 2023 third
quarter), partially offset by higher promotional allowances as a
percentage of net sales, mainly to drive trial and awareness of the
Bang Energy® brand in the United States, as well as the Alcohol
Brands Inventory Reserves.
Operating expenses for the 2024 third quarter were $519.9
million, compared with $473.2 million in the 2023 third quarter.
Operating expenses as a percentage of net sales for the 2024 third
quarter were 27.6 percent, compared with 25.5 percent in the 2023
third quarter. Operating expenses for the 2024 third quarter
included the Hansen Expenses.
Distribution expenses for the 2024 third quarter were $82.7
million, or 4.4 percent of net sales, compared with $85.7 million,
or 4.6 percent of net sales, in the 2023 third quarter.
Selling expenses for the 2024 third quarter were $196.1 million,
or 10.4 percent of net sales, compared with $177.2 million, or 9.5
percent of net sales, in the 2023 third quarter.
General and administrative expenses for the 2024 third quarter
were $241.1 million, or 12.8 percent of net sales, compared with
$210.3 million, or 11.3 percent of net sales, for the 2023 third
quarter. Stock-based compensation was $27.5 million for the 2024
third quarter, compared with $17.9 million in the 2023 third
quarter. General and administrative expenses for the 2024 third
quarter included the Hansen Expenses
Operating income for the 2024 third quarter was $479.9 million,
compared with $510.5 million in the 2023 third quarter. Adjusted
operating income for the 2024 third quarter was $508.4 million,
compared with $526.8 million in the 2023 third quarter. (See
“Adjusted Condensed Consolidated Statements of Income and Other
Information” and “Reconciliation of GAAP and Non-GAAP Information”
below).
The effective tax rate for the 2024 third quarter was 21.8
percent, compared with 22.2 percent in the 2023 third quarter.
Net income for the 2024 third quarter decreased 18.1 percent to
$370.9 million, from $452.7 million in the 2023 third quarter.
Adjusted net income for the 2024 third quarter decreased 8.8
percent to $392.4 million from adjusted net income of $430.0
million in the 2023 third quarter. (See “Adjusted Condensed
Consolidated Statements of Income and Other Information” and
“Reconciliation of GAAP and Non-GAAP Information” below).
Net income per diluted share for the 2024 third quarter
decreased 11.7 percent to $0.38, from $0.43 in the third quarter of
2023. Adjusted net income per diluted share was $0.40 per share for
the 2024 third quarter compared with adjusted net income per
diluted share of $0.41 per share for the 2023 third quarter. (See
“Adjusted Condensed Consolidated Statements of Income and Other
Information” and “Reconciliation of GAAP and Non-GAAP Information”
below).
Hilton H. Schlosberg, Vice Chairman and Co-Chief Executive
Officer, said, “The energy drink category continues to grow
globally and has demonstrated resilience. In the United States, the
energy drink category continued to experience slower growth rates.
However, in all measured channels excluding convenience, the energy
drink category is growing at a faster rate. In the United States,
the energy drink category in the convenience channel is beginning
to show some improvement in October. A number of other consumer
packaged goods companies have also seen a tighter consumer spending
environment for certain income groups and weaker demand in the
quarter.
“We believe growth opportunities in household penetration and
per capita consumption, along with consumers’ growing need for
energy are positive trends for the category.
“Our sales in non-Nielsen measured channels continued to
grow.
“Our third quarter financial results were again impacted by
unfavorable foreign currency exchange rates in certain markets. On
a foreign currency adjusted basis excluding the Alcohol Brands
segment, net sales increased 5.0 percent in the quarter. We
estimate that diluted earnings per share were adversely impacted by
approximately $0.03 per share due to the unfavorable foreign
currency exchange rates. Hurricanes Helene and Milton impacted
sales at retail in certain states in September and October 2024,
however we cannot determine the impact on our business.
“Gross profit margins improved in the 2024 third quarter,
compared with the 2023 third quarter, both on a reported and
adjusted basis and were higher on an adjusted basis compared with
the 2024 second quarter.
“As previously reported, we have implemented an approximately
5.0 percent price increase on our brands and packages, excluding
Bang Energy®, Reign® and Reign Storm® in the United States,
effective November 1, 2024,” Schlosberg added.
Rodney C. Sacks, Chairman and Co-Chief Executive Officer, said,
“Innovation continues to play a key role in our strategy. Globally
our innovation has been generally well received by our
bottlers/distributors, wholesalers, retailers and consumers. We
launched Monster Energy® Ultra Vice Guava™ in the United States in
October, with positive consumer response.
“Predator Energy® Gold Strike, launched in April 2024 in
selected provinces in China, continues to perform and plans are
underway to accelerate its rollout into further markets in
China.
“Our Alcohol Brands segment has now been restructured under new
management and we remain positive for the prospects of alcohol
products within our broader portfolio. In the 2024 third quarter,
we launched a second variety pack of The BeastTM in a 12-pack of
slim 12-oz cans, comprising of Mean Green, Pink Poison, Gnarly
Grape and Killer Sunrise. We are currently exploring opportunities
for distribution of our alcohol products in certain international
jurisdictions.
“Our innovation pipeline for both our non-alcoholic and
alcoholic beverages remains robust,” Sacks
said. 2024
Nine-Months ResultsNet sales for the nine-months ended
September 30, 2024 increased 5.0 percent to $5.68 billion,
from $5.41 billion in the comparable period last year. Net changes
in foreign currency exchange rates had an unfavorable impact of
$194.8 million on net sales for the nine-months ended September 30,
2024. Net sales on a foreign currency adjusted basis increased 8.6
percent in the nine-months ended September 30, 2024.
Gross profit, as a percentage of net sales, for the nine-months
ended September 30, 2024 was 53.6 percent, compared with 52.8
percent in the comparable period last year.
Operating expenses for the nine-months ended September 30,
2024 were $1.50 billion, compared with $1.34 billion in the
comparable period last year.
Operating income for the nine-months ended September 30,
2024 increased to $1.55 billion, from $1.52 billion in the
comparable period last year.
The effective tax rate was 22.8 percent for the nine-months
ended September 30, 2024, compared with 21.9 percent in the
comparable period last year.
Net income for the nine-months ended September 30, 2024
decreased 2.0 percent to $1.24 billion, from $1.26 billion in the
comparable period last year. Net income per diluted share for
the nine-months ended September 30, 2024 increased 1.4 percent
to $1.21, from $1.19 in the comparable period last year. Adjusted
net income for the nine-months ended September 30, 2024 increased
1.0 percent to $1.26 billion from adjusted net income of $1.25
billion for the nine-months ended September 30, 2023. Adjusted net
income per diluted share was $1.23 per share for the nine-months
ended September 30, 2024 compared with adjusted net income per
diluted share of $1.18 per share for the nine-months ended
September 30, 2023. (See “Adjusted Condensed Consolidated
Statements of Income and Other Information” and “Reconciliation of
GAAP and Non-GAAP Information” below).
Share Repurchase ProgramDuring the
2024 third quarter, the Company purchased approximately 11.3
million shares of its common stock at an average purchase price of
$47.32 per share, for a total amount of $534.7 million. As of
November 6, 2024, approximately $500.0 million remained available
for repurchase under the previously authorized repurchase
program.
Investor Conference CallThe
Company will host an investor conference call today, November 7,
2024, 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 CorporationBased 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 Energy® Nitro energy drinks,
Reign® Total Body Fuel high performance energy drinks, Reign Storm®
total wellness energy drinks, NOS® energy drinks, Full Throttle®
energy drinks, Bang 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 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, The
BeastTM and Nasty Beast™ Hard Tea. For more information visit
www.monsterbevcorp.com.
Caution Concerning Forward-Looking
StatementsCertain 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 military conflicts, 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 and achieving profitability within our Alcohol Brands
segment; 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, including a slowdown in consumer spending generally or
reduced demand for consumer goods; 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, 2023 and our subsequently
filed quarterly reports. 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
NINE-MONTHS ENDED SEPTEMBER 30, 2024 AND 2023(In
Thousands, Except Per Share Amounts)
(Unaudited)
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
| Net sales¹ |
$ |
1,880,973 |
|
|
$ |
1,856,028 |
|
|
$ |
5,680,668 |
|
|
$ |
5,409,919 |
|
| |
|
|
|
|
|
|
|
| Cost of sales |
|
881,174 |
|
|
|
872,265 |
|
|
|
2,634,235 |
|
|
|
2,554,086 |
|
| |
|
|
|
|
|
|
|
| Gross profit¹ |
|
999,799 |
|
|
|
983,763 |
|
|
|
3,046,433 |
|
|
|
2,855,833 |
|
| Gross profit as a percentage
of net sales |
|
53.2 |
% |
|
|
53.0 |
% |
|
|
53.6 |
% |
|
|
52.8 |
% |
| |
|
|
|
|
|
|
|
| Operating expenses |
|
519,883 |
|
|
|
473,236 |
|
|
|
1,497,363 |
|
|
|
1,336,437 |
|
| Operating expenses as a
percentage of net sales |
|
27.6 |
% |
|
|
25.5 |
% |
|
|
26.4 |
% |
|
|
24.7 |
% |
| |
|
|
|
|
|
|
|
| Operating income¹ |
|
479,916 |
|
|
|
510,527 |
|
|
|
1,549,070 |
|
|
|
1,519,396 |
|
| Operating income as a
percentage of net sales |
|
25.5 |
% |
|
|
27.5 |
% |
|
|
27.3 |
% |
|
|
28.1 |
% |
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| Interest and other (expense)
income, net |
|
(5,820 |
) |
|
|
71,357 |
|
|
|
54,311 |
|
|
|
99,010 |
|
| |
|
|
|
|
|
|
|
| Income before provision for
income taxes¹ |
|
474,096 |
|
|
|
581,884 |
|
|
|
1,603,381 |
|
|
|
1,618,406 |
|
| |
|
|
|
|
|
|
|
| Provision for income
taxes |
|
103,177 |
|
|
|
129,190 |
|
|
|
365,044 |
|
|
|
354,397 |
|
| Income taxes as a percentage
of income before taxes |
|
21.8 |
% |
|
|
22.2 |
% |
|
|
22.8 |
% |
|
|
21.9 |
% |
| |
|
|
|
|
|
|
|
| Net income |
$ |
370,919 |
|
|
$ |
452,694 |
|
|
$ |
1,238,337 |
|
|
$ |
1,264,009 |
|
| Net income as a percentage of
net sales |
|
19.7 |
% |
|
|
24.4 |
% |
|
|
21.8 |
% |
|
|
23.4 |
% |
| |
|
|
|
|
|
|
|
| Net income per common
share: |
|
|
|
|
|
|
|
|
Basic |
$ |
0.38 |
|
|
$ |
0.43 |
|
|
$ |
1.22 |
|
|
$ |
1.21 |
|
|
Diluted |
$ |
0.38 |
|
|
$ |
0.43 |
|
|
$ |
1.21 |
|
|
$ |
1.19 |
|
| |
|
|
|
|
|
|
|
| Weighted average number of
shares of common stock and common stock equivalents: |
|
|
|
|
|
|
|
|
Basic |
|
975,841 |
|
|
|
1,047,015 |
|
|
|
1,015,252 |
|
|
|
1,046,337 |
|
|
Diluted |
|
983,171 |
|
|
|
1,059,966 |
|
|
|
1,023,912 |
|
|
|
1,059,809 |
|
| |
|
|
|
|
|
|
|
| Energy Drink Case sales (in
thousands) (in 192-ounce case equivalents) |
|
219,409 |
|
|
|
203,087 |
|
|
|
643,033 |
|
|
|
583,937 |
|
| Average net sales per
case2 |
$ |
8.36 |
|
|
$ |
8.90 |
|
|
$ |
8.59 |
|
|
$ |
8.98 |
|
| |
|
|
|
|
|
|
|
¹Includes $10.0 million for both the
three-months ended September 30, 2024 and 2023, related to the
recognition of deferred revenue. Includes $29.9 million and $30.0
million for the nine-months ended September 30, 2024 and 2023,
respectively, related to the recognition of deferred revenue.
2Excludes Alcohol Brands segment and Other
segment net sales.
MONSTER BEVERAGE CORPORATION AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE
SHEETSAS OF SEPTEMBER 30, 2024 AND DECEMBER 31,
2023(In Thousands, Except Par Value)
(Unaudited)
|
|
|
September 30,2024 |
|
December 31,2023 |
|
ASSETS |
|
|
|
|
| CURRENT ASSETS: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,625,339 |
|
|
$ |
2,297,675 |
|
| Short-term investments |
|
|
- |
|
|
|
955,605 |
|
| Accounts receivable, net |
|
|
1,285,397 |
|
|
|
1,193,964 |
|
| Inventories |
|
|
770,338 |
|
|
|
971,406 |
|
| Prepaid expenses and other
current assets |
|
|
124,656 |
|
|
|
116,195 |
|
| Prepaid income taxes |
|
|
92,028 |
|
|
|
54,151 |
|
|
Total current assets |
|
|
3,897,758 |
|
|
|
5,588,996 |
|
| |
|
|
|
|
| INVESTMENTS |
|
|
- |
|
|
|
76,431 |
|
| PROPERTY AND EQUIPMENT,
net |
|
|
1,006,788 |
|
|
|
890,796 |
|
| DEFERRED INCOME TAXES,
net |
|
|
183,430 |
|
|
|
175,003 |
|
| GOODWILL |
|
|
1,417,941 |
|
|
|
1,417,941 |
|
| OTHER INTANGIBLE ASSETS,
net |
|
|
1,442,426 |
|
|
|
1,427,139 |
|
| OTHER ASSETS |
|
|
104,958 |
|
|
|
110,216 |
|
|
Total Assets |
|
$ |
8,053,301 |
|
|
$ |
9,686,522 |
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
| CURRENT LIABILITIES: |
|
|
|
|
| Accounts payable |
|
$ |
549,028 |
|
|
$ |
564,379 |
|
| Accrued liabilities |
|
|
259,088 |
|
|
|
183,988 |
|
| Accrued promotional
allowances |
|
|
301,973 |
|
|
|
269,061 |
|
| Deferred revenue |
|
|
45,627 |
|
|
|
41,914 |
|
| Accrued compensation |
|
|
81,787 |
|
|
|
87,392 |
|
| Income taxes payable |
|
|
7,641 |
|
|
|
14,955 |
|
|
Total current liabilities |
|
|
1,245,144 |
|
|
|
1,161,689 |
|
| |
|
|
|
|
| DEFERRED REVENUE |
|
|
186,135 |
|
|
|
204,251 |
|
| DEFERRED INCOME TAXES |
|
|
28,896 |
|
|
|
- |
|
| OTHER LIABILITIES |
|
|
64,884 |
|
|
|
91,838 |
|
| LONG-TERM DEBT |
|
|
748,842 |
|
|
|
- |
|
| STOCKHOLDERS' EQUITY: |
|
|
|
|
| Common stock -
$0.005 par value; 5,000,000 shares authorized;1,125,699 shares
issued and 972,450 shares outstanding as of September 30,
2024;1,122,592 shares issued and 1,041,571 shares outstanding as of
December 31, 2023 |
|
5,628 |
|
|
|
5,613 |
|
| Additional paid-in
capital |
|
|
5,105,957 |
|
|
|
4,975,115 |
|
| Retained earnings |
|
|
7,178,073 |
|
|
|
5,939,736 |
|
| Accumulated other
comprehensive loss |
|
|
(137,842 |
) |
|
|
(125,337 |
) |
| Common stock in
treasury, at cost; 153,249 shares and 81,021 shares as of
September 30, 2024 and December 31, 2023, respectively |
|
(6,372,416 |
) |
|
|
(2,566,383 |
) |
|
Total stockholders' equity |
|
|
5,779,400 |
|
|
|
8,228,744 |
|
|
Total Liabilities and Stockholders’ Equity |
|
$ |
8,053,301 |
|
|
$ |
9,686,522 |
|
| |
|
|
|
|
|
|
|
|
MONSTER BEVERAGE CORPORATION AND
SUBSIDIARIESADJUSTED CONDENSED CONSOLIDATED
STATEMENTS OF INCOME AND OTHER INFORMATIONFOR THE
THREE- AND NINE-MONTHS ENDED SEPTEMBER 30, 2024 AND
20231(In Thousands, Except Per
Share Amounts)
(Unaudited)
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
| Net sales |
$ |
1,880,973 |
|
|
$ |
1,856,028 |
|
|
$ |
5,680,668 |
|
|
$ |
5,409,919 |
|
| |
|
|
|
|
|
|
|
| Cost of sales |
|
870,587 |
|
|
|
864,440 |
|
|
|
2,623,648 |
|
|
|
2,546,261 |
|
| |
|
|
|
|
|
|
|
| Gross profit |
|
1,010,386 |
|
|
|
991,588 |
|
|
|
3,057,020 |
|
|
|
2,863,658 |
|
| Gross profit as a percentage
of net sales |
|
53.7 |
% |
|
|
53.4 |
% |
|
|
53.8 |
% |
|
|
52.9 |
% |
| |
|
|
|
|
|
|
|
| Operating expenses |
|
502,023 |
|
|
|
464,794 |
|
|
|
1,479,209 |
|
|
|
1,318,981 |
|
| Operating expenses as a
percentage of net sales |
|
26.7 |
% |
|
|
25.0 |
% |
|
|
26.0 |
% |
|
|
24.4 |
% |
| |
|
|
|
|
|
|
|
| Operating income |
|
508,363 |
|
|
|
526,794 |
|
|
|
1,577,811 |
|
|
|
1,544,677 |
|
| Operating income as a
percentage of net sales |
|
27.0 |
% |
|
|
28.4 |
% |
|
|
27.8 |
% |
|
|
28.6 |
% |
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| Interest and other (expense)
income, net |
|
(5,820 |
) |
|
|
25,975 |
|
|
|
54,311 |
|
|
|
53,628 |
|
| |
|
|
|
|
|
|
|
| Income before provision for
income taxes¹ |
|
502,543 |
|
|
|
552,769 |
|
|
|
1,632,122 |
|
|
|
1,598,305 |
|
| |
|
|
|
|
|
|
|
| Provision for income
taxes |
|
110,163 |
|
|
|
122,729 |
|
|
|
372,097 |
|
|
|
349,953 |
|
| Income taxes as a percentage
of income before taxes |
|
21.9 |
% |
|
|
22.2 |
% |
|
|
22.8 |
% |
|
|
21.9 |
% |
| |
|
|
|
|
|
|
|
| Net income |
$ |
392,380 |
|
|
$ |
430,040 |
|
|
$ |
1,260,025 |
|
|
$ |
1,248,352 |
|
| Net income as a percentage of
net sales |
|
20.9 |
% |
|
|
23.2 |
% |
|
|
22.2 |
% |
|
|
23.1 |
% |
| |
|
|
|
|
|
|
|
| Net income per common
share: |
|
|
|
|
|
|
|
|
Basic |
$ |
0.40 |
|
|
$ |
0.41 |
|
|
$ |
1.24 |
|
|
$ |
1.19 |
|
|
Diluted |
$ |
0.40 |
|
|
$ |
0.41 |
|
|
$ |
1.23 |
|
|
$ |
1.18 |
|
| |
|
|
|
|
|
|
|
| Weighted average number of
shares of common stock and common stock equivalents: |
|
|
|
|
|
|
|
|
Basic |
|
975,841 |
|
|
|
1,047,015 |
|
|
|
1,015,252 |
|
|
|
1,046,337 |
|
|
Diluted |
|
983,171 |
|
|
|
1,059,966 |
|
|
|
1,023,912 |
|
|
|
1,059,809 |
|
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
1See “Reconciliation of GAAP and non-GAAP Information” below for
excluded items.
Reconciliation of GAAP and Non-GAAP
Information ($ in Thousands, Except Per Share
Amounts, unaudited)
Adjusted results are non-GAAP items that exclude (i) the Alcohol
Brands Inventory Reserves, (ii) the Bang Inventory Step-Up, (iii)
the Hansen Expenses, (iv) the Bang Transaction Expenses and (v) the
Bang Transaction Gain. The Company believes that these non-GAAP
items are useful to investors in evaluating the Company’s ongoing
operating and financial results. The non-GAAP items should be
considered in addition to, and not in lieu of, U.S. GAAP financial
measures.
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
| Cost of sales |
$ |
881,174 |
|
|
$ |
872,265 |
|
|
$ |
2,634,235 |
|
|
$ |
2,554,086 |
|
|
|
|
|
|
|
|
|
|
| Alcohol brands inventory
reserve |
|
(10,587 |
) |
|
|
- |
|
|
|
(10,587 |
) |
|
|
- |
|
| Bang inventory step-up |
|
- |
|
|
|
(7,825 |
) |
|
|
- |
|
|
|
(7,825 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cost of sales excluding above
items |
$ |
870,587 |
|
|
$ |
864,440 |
|
|
$ |
2,623,648 |
|
|
$ |
2,546,261 |
|
| |
|
|
|
|
|
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
| Gross profit |
$ |
999,799 |
|
$ |
983,763 |
|
$ |
3,046,433 |
|
$ |
2,855,833 |
|
|
|
|
|
|
|
|
|
| Alcohol brands inventory
reserve |
|
10,587 |
|
|
- |
|
|
10,587 |
|
|
- |
| Bang inventory step-up |
|
- |
|
|
7,825 |
|
|
- |
|
|
7,825 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Gross profit excluding above
items |
$ |
1,010,386 |
|
$ |
991,588 |
|
$ |
3,057,020 |
|
$ |
2,863,658 |
| |
|
|
|
|
|
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
| Operating expenses |
$ |
519,883 |
|
|
$ |
473,236 |
|
|
$ |
1,497,363 |
|
|
$ |
1,336,437 |
|
|
|
|
|
|
|
|
|
|
| Hansen Expenses |
|
(17,860 |
) |
|
|
(409 |
) |
|
|
(18,154 |
) |
|
|
(2,354 |
) |
| |
|
|
|
|
|
|
|
| Bang transaction expenses |
|
- |
|
|
|
(8,033 |
) |
|
|
- |
|
|
|
(15,102 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating expenses excluding
above items |
$ |
502,023 |
|
|
$ |
464,794 |
|
|
$ |
1,479,209 |
|
|
$ |
1,318,981 |
|
| |
|
|
|
|
|
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
| Operating income |
$ |
479,916 |
|
$ |
510,527 |
|
$ |
1,549,070 |
|
$ |
1,519,396 |
|
|
|
|
|
|
|
|
|
| Alcohol brands inventory
reserve |
|
10,587 |
|
|
- |
|
|
10,587 |
|
|
- |
| Bang inventory step-up |
|
- |
|
|
7,825 |
|
|
- |
|
|
7,825 |
| Hansen Expenses |
|
17,860 |
|
|
409 |
|
|
18,154 |
|
|
2,354 |
| |
|
|
|
|
|
|
|
| Bang transaction expenses |
|
- |
|
|
8,033 |
|
|
- |
|
|
15,102 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating income excluding
above items |
$ |
508,363 |
|
$ |
526,794 |
|
$ |
1,577,811 |
|
$ |
1,544,677 |
| |
|
|
|
|
|
|
|
|
Reconciliation of GAAP and Non-GAAP Information
(cont.)($ in Thousands, unaudited) |
|
|
|
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
| Interest and other (expense)
income, net |
$ |
(5,820 |
) |
|
$ |
71,357 |
|
|
$ |
54,311 |
|
$ |
99,010 |
|
|
|
|
|
|
|
|
|
|
| Bang transaction gain |
|
- |
|
|
|
(45,382 |
) |
|
|
- |
|
|
(45,382 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest and other (expense)
income, net, excluding above item |
$ |
(5,820 |
) |
|
$ |
25,975 |
|
|
$ |
54,311 |
|
$ |
53,628 |
|
| |
|
|
|
|
|
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
| Income before provision for
income taxes |
$ |
474,096 |
|
$ |
581,884 |
|
|
$ |
1,603,381 |
|
$ |
1,618,406 |
|
|
|
|
|
|
|
|
|
|
| Alcohol brands inventory
reserve |
|
10,587 |
|
|
- |
|
|
|
10,587 |
|
|
- |
|
| Bang inventory step-up |
|
- |
|
|
7,825 |
|
|
|
- |
|
|
7,825 |
|
| Hansen Expenses |
|
17,860 |
|
|
409 |
|
|
|
18,154 |
|
|
2,354 |
|
| |
|
|
|
|
|
|
|
| Bang transaction expenses |
|
- |
|
|
8,033 |
|
|
|
- |
|
|
15,102 |
|
| Bang transaction gain |
|
- |
|
|
(45,382 |
) |
|
|
- |
|
|
(45,382 |
) |
| |
|
|
|
|
|
|
|
| Income before provision for
income taxes excluding above items |
$ |
502,543 |
|
$ |
552,769 |
|
|
$ |
1,632,122 |
|
$ |
1,598,305 |
|
| |
|
|
|
|
|
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
| Provision for income
taxes |
$ |
103,177 |
|
$ |
129,190 |
|
|
$ |
365,044 |
|
$ |
354,397 |
|
|
|
|
|
|
|
|
|
|
| Alcohol brands inventory
reserve |
|
2,594 |
|
|
- |
|
|
|
2,594 |
|
|
- |
|
| Bang inventory step-up |
|
- |
|
|
1,737 |
|
|
|
- |
|
|
1,737 |
|
| Hansen Expenses |
|
4,392 |
|
|
94 |
|
|
|
4,459 |
|
|
541 |
|
| |
|
|
|
|
|
|
|
| Bang transaction expenses |
|
- |
|
|
1,783 |
|
|
|
- |
|
|
3,353 |
|
| Bang transaction gain |
|
- |
|
|
(10,075 |
) |
|
|
- |
|
|
(10,075 |
) |
| |
|
|
|
|
|
|
|
| Provision for income taxes
excluding above items |
$ |
110,163 |
|
$ |
122,729 |
|
|
$ |
372,097 |
|
$ |
349,953 |
|
| |
|
|
|
|
|
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
| Net income |
$ |
370,919 |
|
$ |
452,694 |
|
|
$ |
1,238,337 |
|
$ |
1,264,009 |
|
|
|
|
|
|
|
|
|
|
| Alcohol brands inventory
reserve |
|
7,993 |
|
|
- |
|
|
|
7,993 |
|
|
- |
|
| Bang inventory step-up |
|
- |
|
|
6,088 |
|
|
|
- |
|
|
6,088 |
|
| Hansen Expenses |
|
13,468 |
|
|
315 |
|
|
|
13,695 |
|
|
1,813 |
|
| |
|
|
|
|
|
|
|
| Bang transaction expenses |
|
- |
|
|
6,250 |
|
|
|
- |
|
|
11,749 |
|
| Bang transaction gain |
|
- |
|
|
(35,307 |
) |
|
|
- |
|
|
(35,307 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income excluding above
items |
$ |
392,380 |
|
$ |
430,040 |
|
|
$ |
1,260,025 |
|
$ |
1,248,352 |
|
| |
|
|
|
|
|
|
|
Adjustments in this table are net of tax.
|
Reconciliation of GAAP and Non-GAAP Information
(cont.)($ in Thousands, unaudited) |
|
|
|
|
Three-Months Ended |
|
Nine-Months Ended |
|
|
September 30, |
|
September 30, |
|
|
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
2023 |
|
| Net income per common share –
Diluted |
$ |
0.38 |
|
$ |
0.43 |
|
|
$ |
1.21 |
|
$ |
1.19 |
|
|
|
|
|
|
|
|
|
|
| Cumulative adjustments, net of
tax |
|
0.02 |
|
|
(0.02 |
) |
|
|
0.02 |
|
|
(0.01 |
) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income per common share –
Diluted, excluding above items |
$ |
0.40 |
|
$ |
0.41 |
|
|
$ |
1.23 |
|
$ |
1.18 |
|
| |
|
|
|
|
|
|
|
|
CONTACTS: |
Rodney C.
SacksChairman and Co-Chief Executive Officer(951) 739-6200Hilton H.
SchlosbergVice Chairman and Co-Chief Executive Officer(951)
739-6200Roger S. Pondel / Judy LinPondelWilkinson Inc.(310)
279-5980 |
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