Q4 net sales up 4.4% year-over-year, including
volume growth of 11.6%
Record gross profit margin of 49.2% in Q4
Zevia PBC (“Zevia” or the “Company”) (NYSE: ZVIA), the Company
bringing naturally delicious, zero sugar, clean-label beverages,
today reported results for the fourth quarter and fiscal year ended
December 31, 2024.
Fourth Quarter 2024 Highlights
- Net sales of $39.5 million, an improvement of $1.7 million year
over year
- Gross profit margin was 49.2%, an improvement of 8.5 percentage
points year over year and the highest quarterly gross profit margin
as a public company
- Net loss was $6.8 million, including $1.0 million of non-cash
equity-based compensation expense, an improvement of $2.4 million
year over year
- Adjusted EBITDA loss was $3.9 million(1), an improvement of
$3.0 million year over year
- Loss per share was $0.09 to Zevia’s Class A Common
stockholders, an improvement of $0.05 year over year
Full Year 2024 Highlights
- Net sales of $155.0 million, a decline of $11.4 million year
over year
- Gross profit margin was 46.4%, an improvement of 1.5 percentage
points year over year
- Net loss was $23.8 million, including $5.0 million of non-cash
equity-based compensation expense, an improvement of $4.5 million
year over year
- Adjusted EBITDA loss was $15.2 million(1), an improvement of
$3.8 million year over year
- Loss per share was $0.34 to Zevia’s Class A Common
stockholders, an improvement of $0.07 year over year
(1) Adjusted EBITDA is a non-GAAP financial measure. See the
supplementary schedules in this press release for a discussion of
how we define and calculate this measure and a reconciliation
thereof to the most directly comparable GAAP measure.
“We are pleased to have ended the year on a strong note with a
return to top line growth and significant progress towards
achieving profitability. We elevated our brand identity, advanced
our three strategic growth pillars and continued to lay a strong
foundation for growth and profitability over the long term.” said
Amy Taylor, President and Chief Executive Officer of Zevia.
“The green shoots we saw across the business in the fourth
quarter including our viral holiday campaign, successful new flavor
and variety pack launches and expanded distribution in Walmart keep
us optimistic about our path forward. Looking ahead, we remain
focused on building brand awareness, accelerating product
innovation and driving in-store visibility to capitalize on our
unique market position within the fast growing and dynamic
better-for-you soda category.”
Fourth Quarter 2024 Results
Net sales improved 4.4% to $39.5 million in the fourth quarter
of 2024 compared to $37.8 million in the fourth quarter of 2023,
due to improved volumes of 11.6% largely driven by expanded
distribution at Walmart, partially offset by increased promotional
activity at retailers.
Gross profit margin was 49.2% in the fourth quarter of 2024
compared to 40.7% in the fourth quarter of 2023, an improvement of
8.5 percentage points. The improvement was primarily due to lower
inventory write-downs and favorable unit costs, partially offset by
higher promotional levels.
Selling and marketing expenses were $16.5 million, or 41.7% of
net sales, in the fourth quarter of 2024 compared to $13.8 million,
or 36.6%, of net sales in the fourth quarter of 2023. The increase
was primarily driven by investments made in marketing to drive
brand awareness and increased freight out due to higher volumes.
This increase was partially offset by a decrease in freight
transfers and warehousing costs as a result of the impact of supply
chain logistics challenges in the prior year as well as the
Productivity Initiative.
General and administrative expenses were $6.8 million, or 17.3%
of net sales, in the fourth quarter of 2024 compared to $8.4
million, or 22.2%, of net sales in the fourth quarter of 2023. The
decrease of $1.6 million was primarily driven by a decrease in
costs as a result of our Productivity Initiative.
Equity-based compensation, a non-cash expense, was $1.0 million
in the fourth quarter of 2024, compared to $1.7 million in the
fourth quarter of 2023. The decrease of $0.7 million was largely
due to the accelerated method of expense recognition on certain
equity awards issued in connection with the Company’s IPO in 2021,
partially offset by equity-based compensation expense related to
new equity awards granted.
Restructuring expenses were $1.2 million in the fourth quarter
of 2024 and primarily includes costs for restructuring consulting
services and an impairment loss of certain assets as a result of
sublease agreement.
Net loss for the fourth quarter of 2024 was $6.8 million,
compared to net loss of $9.2 million in the fourth quarter of
2023.
Loss per share for the fourth quarter of 2024 was $0.09 to
Zevia’s Class A Common stockholders, compared to loss per share of
$0.14 in the fourth quarter of 2023.
Adjusted EBITDA loss was $3.9 million in the fourth quarter of
2024, compared to an Adjusted EBITDA loss of $6.9 million in the
fourth quarter of 2023. Adjusted EBITDA is a non-GAAP financial
measure. See the supplementary schedules in this press release for
a discussion of how we define and calculate this measure and a
reconciliation thereof to the most directly comparable GAAP
measure.
Full Year 2024 Results
Net sales decreased 6.8% to $155.0 million in the full year of
2024 compared to $166.4 million in the full year of 2023, largely
due to reduced volumes of 4.8% as a result of expected lost
distribution in our club channel and one customer in our mass
channel, and to a lesser degree an increase in promotional activity
at retailers leading to lower sales. These decreases were partially
offset by expanded distribution at Walmart.
Gross profit margin was 46.4% in the full year of 2024 compared
to 44.9% in the full year of 2023, an improvement of 1.5 percentage
points. The improvement was primarily due to lower inventory
write-downs and favorable product mix, partially offset by higher
unit costs and increased spend on promotional activity.
Selling and marketing expenses were $57.1 million, or 36.8% of
net sales, in the full year of 2024 compared to $62.3 million, or
37.4%, of net sales in the full year of 2023. The improvement was
primarily due to a decrease in freight transfers and warehousing
costs as a result of the impact of supply chain logistics
challenges in the prior year as well as the Productivity
Initiative, and a decrease in repackaging and freight out costs due
to lower volumes. These decreases were partially offset by
investments made in marketing to drive brand awareness.
General and administrative expenses were $30.0 million, or 19.4%
of net sales, in the full year of 2024 compared to $31.5 million,
or 18.9%, of net sales in the full year of 2023. The decrease of
$1.5 million was primarily driven by a decrease in costs as a
result of our Productivity Initiative.
Equity-based compensation, a non-cash expense, was $5.0 million
in the full year of 2024, compared to $8.3 million in the full year
of 2023. The decrease of $3.3 million was largely due to the
accelerated method of expense recognition on certain equity awards
issued in connection with the Company’s IPO in 2021, partially
offset by equity-based compensation expense related to new equity
awards granted.
Restructuring expenses were $2.1 million in the full year of
2024 and primarily includes employee related severance costs,
restructuring consulting services, impairment loss of certain
assets as a result of sublease agreement, and costs to exit two of
our third-party warehouse and distribution facilities.
Net loss for the full year of 2024 was $23.8 million, compared
to net loss of $28.3 million in the full year of 2023.
Loss per share for the full year of 2024 was $0.34 to Zevia’s
Class A Common stockholders, compared to loss per share of $0.41 in
the full year of 2023.
Adjusted EBITDA loss was $15.2 million in the full year of 2024,
compared to an Adjusted EBITDA loss of $19.0 million in the full
year of 2023. Adjusted EBITDA is a non-GAAP financial measure. See
the supplementary schedules in this press release for a discussion
of how we define and calculate this measure and a reconciliation
thereof to the most directly comparable GAAP measure.
Balance Sheet and Cash Flows
As of December 31, 2024, the Company had $30.7 million in cash
and cash equivalents and no outstanding debt, as well as an unused
credit line of $20 million.
Guidance
“We are pleased with the progress we have made in our strategic
growth pillars as well as our productivity initiative,” stated
Girish Satya, Chief Financial Officer of Zevia. “As we look ahead
to 2025, we expect to return to growth for the full year as we work
to capitalize on our strengthened market position and the tailwinds
that we see within the natural soda and better for you beverage
categories.”
For the full year 2025, the Company expects net sales to be in
the range of $158 million to $163 million, and an adjusted EBITDA
loss in the range of $8 million to $11 million. Adjusted EBITDA
guidance reflects a planned increase in marketing and promotional
spend as the Company reinvests cost savings into future growth.
For the first quarter of 2025, the Company expects net sales to
be in the range of $36 million to $38 million, and an adjusted
EBITDA loss of between $5.6 million and $6.0 million. The net sales
guidance reflects the impacts of the aforementioned lost
distribution in our club channel and one customer in our mass
channel. Adjusted EBITDA reflects planned reinvestment in marketing
spend, particularly in the first and third quarters of 2025.
We have not provided the forward-looking GAAP equivalent to our
Adjusted EBITDA outlook or a GAAP reconciliation as a result of the
uncertainty regarding, and the potential variability of,
reconciling items such as stock-based compensation, income tax, and
charges associated with restructuring and cost saving initiatives,
including but not limited to severance costs,
warehouse/distribution facility exit costs, and asset impairments.
Accordingly, a reconciliation of this non-GAAP guidance metric to
its corresponding GAAP equivalent is not available without
unreasonable effort. These items are inherently variable and
uncertain and depend on various factors, some of which are outside
of the Company’s control or ability to predict. However, it is
important to note that the reconciling items could have a
significant effect on future GAAP results. We have provided
historical reconciliations of GAAP to non-GAAP metrics in tables at
the end of this release. For more information regarding the
non-GAAP financial measures discussed in this earnings release,
please see "Reconciliation of GAAP to non-GAAP Financial Results"
below.
Webcast
The Company will host a conference call today at 8:30 a.m.
Eastern Time to discuss this earnings release. Investors and other
interested parties may listen to the webcast of the conference call
by logging on via the Investor Relations section of Zevia’s website
at https://investors.zevia.com/ or directly here. A replay of the
webcast will be available for approximately thirty (30) days
following the call.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include, without limitation, any statement that may
predict, forecast, indicate or imply future results, performance or
achievements, and may contain words such as “anticipate,”
“believe,” “consider,” “contemplate,” “continue,” “could,’”
“estimate,” “expect,” “forecast,” “guidance,” “intend,” “look
ahead,” “may,” “on track,” “outlook,” “plan,” “potential,”
“predict,” “project,” pursue,” “see,” “seek,” “should,” “target,”
“will,” “would,” or the negative of these words or other similar
words, terms or expressions with similar meanings. Forward-looking
statements should not be read as a guarantee of future performance
or results and will not necessarily be accurate indications of the
times at, or by, which such performance or results will be
achieved. Forward-looking statements contained in this press
release relate to, among other things, statements regarding
financial guidance or outlook, expected benefits of and annualized
cost savings from the Productivity Initiative, long-term growth and
profitability plans and opportunities, future results of operations
or financial condition, strategic direction, and plans and
objectives of management for future operations, including
marketing, distribution expansion and product innovation.
Forward-looking statements are based on current expectations,
forecasts and assumptions that involve risks and uncertainties,
including, but not limited to, the ability to develop and maintain
our brand, our ability to successfully execute on our rebranding
strategy, cost reduction initiatives, and to compete effectively,
our ability to maintain supply chain service levels and any
disruption of our supply chain, product demand, changes in the
retail landscape or in sales to any key customer, change in
consumer preferences, pricing factors, our ability to manage
changes in our workforce, future cyber incidents and other
disruptions to our information systems, failure to comply with
personal data protection and privacy laws, the impact of inflation
on our sales growth and cost structure such as increased commodity,
packaging, transportation and freight, warehouse, labor and other
input costs and other economic conditions, our reliance on contract
manufacturers and service providers, competitive and governmental
factors outside of our control, such as pandemics or epidemics,
adverse global macroeconomic conditions, including relatively high
interest rates, instability in financial institutions and a
recessionary environment, any potential shutdown of the U.S.
government, and changes in U.S. foreign trade policies or tariffs,
geopolitical events or conflicts, including the military conflicts
in Ukraine and the Middle East and trade tensions between the U.S.
and China, our ability to maintain our listing on the New York
Stock Exchange, failure to adequately protect our intellectual
property rights or infringement on intellectual property rights of
others, potential liabilities, and costs from litigation, claims,
legal or regulatory proceedings, inquiries or investigations that
may cause our business, strategy or actual results to differ
materially from the forward-looking statements. We do not intend
and undertake no obligation to update any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as may be required by applicable law.
Investors are referred to our filings with the U.S. Securities and
Exchange Commission for additional information regarding the risks
and uncertainties that may cause actual results to differ
materially from those expressed in any forward-looking
statement.
About Zevia
Zevia PBC, a Delaware public benefit corporation designated as a
“Certified B Corporation,” is focused on addressing the global
health challenges resulting from excess sugar consumption by
offering a broad portfolio of zero sugar, zero calorie, naturally
sweetened beverages. All Zevia® beverages are made with a handful
of simple, plant-based ingredients, contain no artificial
sweeteners, and are Non-GMO Project verified, gluten-free, Kosher,
and vegan. Zevia is distributed in more than 37,000 retail
locations in the U.S. and Canada through a diverse network of major
retailers in the grocery, drug, warehouse club, mass, natural,
convenience and ecommerce channels.
(ZEVIA-F)
ZEVIA PBC CONSOLIDATED STATEMENTS
OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED) (in thousands,
except share and per share amounts)
Three Months Ended December
31,
Year Ended December
31,
2024
2023
2024
2023
Net sales
$
39,458
$
37,794
$
155,049
$
166,424
Cost of goods sold
20,040
22,405
83,120
91,666
Gross profit
19,418
15,389
71,929
74,758
Operating expenses:
Selling and marketing
16,459
13,845
57,132
62,312
General and administrative
6,838
8,393
30,024
31,495
Equity-based compensation
1,011
1,665
4,961
8,279
Depreciation and amortization
288
381
1,329
1,615
Restructuring
1,160
—
2,137
—
Total operating expenses
25,756
24,284
95,583
103,701
Loss from operations
(6,338
)
(8,895
)
(23,654
)
(28,943
)
Other (expense) income, net
(420
)
(235
)
(63
)
673
Loss before income taxes
(6,758
)
(9,130
)
(23,717
)
(28,270
)
Provision for income taxes
23
21
66
52
Net loss and comprehensive loss
(6,781
)
(9,151
)
(23,783
)
(28,322
)
Loss attributable to noncontrolling
interest
1,018
1,896
3,778
6,828
Net loss attributable to Zevia
PBC
$
(5,763
)
$
(7,255
)
$
(20,005
)
$
(21,494
)
Net loss per share attributable to common
stockholders
Basic
$
(0.09
)
$
(0.14
)
$
(0.34
)
$
(0.41
)
Diluted
$
(0.09
)
$
(0.14
)
$
(0.34
)
$
(0.41
)
Weighted average common shares
outstanding
Basic
60,612,525
52,220,804
58,683,445
50,618,758
Diluted
60,612,525
52,220,804
58,683,445
50,618,758
ZEVIA PBC CONDENSED CONSOLIDATED
BALANCE SHEETS (UNAUDITED) (in thousands)
December 31, 2024
December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents
$
30,653
$
31,955
Accounts receivable, net
10,795
11,119
Inventories
18,618
34,550
Prepaid expenses and other current
assets
1,843
5,063
Total current assets
61,909
82,687
Property and equipment, net
1,261
2,109
Right-of-use assets under operating
leases, net
1,099
1,959
Intangible assets, net
3,179
3,523
Other non-current assets
503
579
Total assets
$
67,951
$
90,857
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
15,295
$
21,169
Accrued expenses and other current
liabilities
8,340
5,973
Current portion of operating lease
liabilities
587
575
Total current liabilities
24,222
27,717
Operating lease liabilities, net of
current portion
726
1,373
Other non-current liabilities
58
—
Total liabilities
25,006
29,090
Stockholders’ equity
Class A common stock
61
54
Class B common stock
12
17
Additional paid-in capital
186,148
191,144
Accumulated deficit
(121,342
)
(101,337
)
Total Zevia PBC stockholders’
equity
64,879
89,878
Noncontrolling interests
(21,934
)
(28,111
)
Total equity
42,945
61,767
Total liabilities and equity
$
67,951
$
90,857
ZEVIA PBC CONDENSED CONSOLIDATED
STATEMENT OF CASH FLOWS (UNAUDITED) (in thousands)
Year Ended December
31,
2024
2023
Operating activities:
Net loss
$
(23,783
)
$
(28,322
)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Non-cash lease expense
587
567
Sublease impairment loss
351
-
Depreciation and amortization
1,329
1,615
Loss on disposal of property, equipment
and software, net
57
480
Amortization of debt issuance cost
76
76
Equity-based compensation
4,961
8,279
Changes in operating assets and
liabilities:
Accounts receivable, net
324
(42
)
Inventories
15,932
(6,974
)
Prepaid expenses and other assets
3,220
(2,573
)
Accounts payable
(5,863
)
13,640
Accrued expenses and other current
liabilities
2,367
(2,435
)
Operating lease liabilities
(635
)
(585
)
Other non-current liabilities
58
—
Net cash used in operating activities
(1,019
)
(16,274
)
Investing activities:
Purchases of property, equipment and
software
(283
)
(1,624
)
Proceeds from sales of property, equipment
and software
—
2,429
Net cash (used in) provided by investing
activities
(283
)
805
Financing activities:
Proceeds from revolving line of credit
8,000
—
Repayment of revolving line of credit
(8,000
)
—
Proceeds from exercise of stock
options
—
25
Net cash provided by financing
activities
—
25
Net change from operating, investing, and
financing activities
(1,302
)
(15,444
)
Cash and cash equivalents at beginning of
period
31,955
47,399
Cash and cash equivalents at end of
period
$
30,653
$
31,955
Use of Non-GAAP Financial Information
We use Adjusted EBITDA, a financial measure that is not
calculated in accordance with U.S. generally accepted accounting
principles (“GAAP”). The Company’s management believes that
Adjusted EBITDA, when taken together with our financial results
presented in accordance with GAAP, provides meaningful supplemental
information regarding our operating performance and facilitates
internal comparisons of our historical operating performance on a
more consistent basis by excluding certain items that may not be
indicative of our business, results of operations or outlook. In
particular, we believe that the use of Adjusted EBITDA is helpful
to our investors as it is a measure used by management in assessing
the health of our business, determining incentive compensation and
evaluating our operating performance, as well as for internal
planning and forecasting purposes.
We calculate Adjusted EBITDA as net income (loss) adjusted to
exclude: (1) other income (expense), net, which includes interest
(income) expense, foreign currency (gains) losses, (2) provision
(benefit) for income taxes, (3) depreciation and amortization, (4)
equity-based compensation, and (5) restructuring expenses (for
2024, in light of our Productivity Initiative). Adjusted EBITDA may
in the future also be adjusted for amounts impacting net income
related to the Tax Receivable Agreement liability and other
infrequent and unusual transactions.
Adjusted EBITDA is presented for supplemental informational
purposes only, has limitations as an analytical tool and should not
be considered in isolation or as a substitute for financial
information presented in accordance with GAAP. Some of the
limitations of Adjusted EBITDA include that (1) it does not
properly reflect capital commitments to be paid in the future, (2)
although depreciation and amortization are non-cash charges, the
underlying assets may need to be replaced and Adjusted EBITDA does
not reflect these capital expenditures, (3) it does not consider
the impact of equity-based compensation expense, including the
potential dilutive impact thereof, and (4) it does not reflect
other non-operating expenses, including interest (income) expense,
foreign currency (gains) losses, and restructuring. In addition,
our use of Adjusted EBITDA may not be comparable to similarly
titled measures of other companies because they may not calculate
Adjusted EBITDA in the same manner, limiting its usefulness as a
comparative measure. Because of these limitations, when evaluating
our performance, you should consider Adjusted EBITDA alongside
other financial measures, including our net loss or income and
other results stated in accordance with GAAP.
ZEVIA PBC RECONCILIATION OF GAAP TO NON-GAAP
FINANCIAL RESULTS (in thousands) (unaudited)
The following table presents a reconciliation of net loss, the
most directly comparable financial measure stated in accordance
with GAAP, to Adjusted EBITDA for the periods presented:
Three Months Ended December
31,
Year Ended December
31,
2024
2023
2024
2023
Net loss and comprehensive loss
$
(6,781
)
$
(9,151
)
$
(23,783
)
$
(28,322
)
Other expense (income), net*
420
235
63
(673
)
Provision for income taxes
23
21
66
52
Depreciation and amortization
288
381
1,329
1,615
Equity-based compensation
1,011
1,665
4,961
8,279
Restructuring
1,160
—
2,137
—
Adjusted EBITDA
$
(3,879
)
$
(6,849
)
$
(15,227
)
$
(19,049
)
* Includes interest (income) expense, and foreign currency
(gains) losses.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250226073346/en/
Investors Greg Davis Zevia PBC 424-343-2654
Greg@zevia.com Reed Anderson ICR 646-277-1260
Reed.Anderson@icrinc.com
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