-- Record Fourth Quarter
-- Gross Margin Percentage Increases on a Quarterly Sequential Basis --
-- Company Declares Two-for-One Stock Split --
The Company achieved record fourth quarter net sales of
The Company implemented a price increase effective
Since the beginning of the COVID-19 pandemic and the subsequent global supply chain challenges and disruptions, the Company has prioritized product availability for its consumers and customers, despite adversely impacting gross margins and operating income.
Gross profit as a percentage of net sales increased on a sequential quarterly basis to 51.8 percent in the 2022 fourth quarter, from 51.3 percent in the 2022 third quarter.
Gross profit as a percentage of net sales, excluding gross profit for the Company’s Alcohol Brands segment, increased on a sequential quarterly basis to 52.5 percent in the 2022 fourth quarter, from 51.9 percent in the 2022 third quarter.
Fourth Quarter Results
Net sales for the 2022 fourth quarter increased 6.2 percent to
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 True North® Pure Energy Seltzer energy drinks, increased 2.6 percent to
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 41.8 percent to
Net sales for the Alcohol Brands segment, which is comprised of the various craft beers and hard seltzers purchased as part of the CANarchy transaction on
Net sales for the Company’s Other segment, which includes certain products of
Net sales to customers outside
Gross profit as a percentage of net sales for the 2022 fourth quarter was 51.8 percent, compared with 53.9 percent in the 2021 fourth quarter and 51.3 percent for the 2022 third quarter. The decrease in gross profit as a percentage of net sales for the 2022 fourth quarter was primarily the result of (i) increased ingredient and other input costs, including secondary packaging materials and increased co-packing fees, (ii) geographical and product sales mix, and (iii) increased logistical costs. The decrease in gross profit as a percentage of net sales for the 2022 fourth quarter was partially offset by pricing actions.
Operating expenses for the 2022 fourth quarter were
Operating expenses as a percentage of net sales for the 2022 fourth quarter were 25.8 percent, compared with 24.9 percent in the 2021 fourth quarter, and 28.9 percent for the 2019 fourth quarter (pre COVID-19).
Distribution costs for the 2022 fourth quarter increased to
Selling expenses as a percentage of net sales for the 2022 fourth quarter were 9.6 percent, compared with 9.9 percent in the 2021 fourth quarter, and 12.3 percent in the 2019 fourth quarter (pre COVID-19).
General and administrative expenses for the 2022 fourth quarter were
Operating income for the 2022 fourth quarter was
The effective tax rate for both 2022 and 2021 fourth quarters was 23.3 percent.
Net income for the 2022 fourth quarter decreased 6.1 percent to
Vice Chairman and Co-Chief Executive Officer
“We are continuing to deplete the remaining higher cost imported can inventories in
“We believe that some of the increased costs that we have experienced in 2022 are likely to be transitory, although cost inflation, including increases in energy particularly in EMEA, ingredient and other input costs, as well as co-packing fees, remain challenging.
“Certain price increases are being implemented on a phased approach during the first half of 2023, some in addition to price increases or pricing actions already taken in 2022,” Schlosberg added.
“We recently launched our first flavored malt beverage alcohol product, The Beast Unleashed™ in six states. The Beast Unleashed™ contains six percent alcohol by volume and is available in four flavors. We are pleased with early results and plan to expand into additional markets in the 2023 second quarter, with the goal of being national by the end of the year. We have also commenced with the launch of Monster® Tour Water™, a pure unflavored water line, in still and sparkling variants in 19.2 oz cans. We are planning to launch Reign Storm®, which is positioned as a total wellness energy drink, in 12 oz sleek cans at retail in
“In EMEA, as part of an ongoing pan-EMEA launch in the first quarter of 2023, we commenced distribution of Monster Energy® Lewis Hamilton 44 Zero Sugar. We also launched Fury, one of our affordable energy brands, in
“We are planning to transition the Monster brand to the Coca-Cola distribution system in the Philippines in the second quarter of 2023.
“Our innovation pipeline of both alcoholic and non-alcoholic beverages continues to be robust,” Sacks added.
2022 Full-Year Results
Net sales for the twelve-months ended
Gross profit, as a percentage of net sales, for the twelve-months ended
Operating expenses for the twelve-months ended
Operating income for the twelve-months ended
The effective tax rate was 24.2 percent for the twelve-months ended
Net income for the twelve-months ended
Share Repurchase Program
During the 2022 fourth quarter, the Company purchased approximately 2.3 million shares of its common stock at an average purchase price of
The Company today announced that its Board of Directors has approved and declared a 2-for-1 split of its common stock that will be effected in the form of a 100% stock dividend. Each stockholder of record on
Investor Conference Call
The Company will host an investor conference call today,
Caution Concerning Forward-Looking Statements
Certain statements made in this announcement may constitute “forward-looking statements” within the meaning of the
# # #
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER INFORMATION
FOR THE THREE- AND TWELVE-MONTHS ENDED
(In Thousands, Except Per Share Amounts) (Unaudited)
|Three-Months Ended||Twelve-Months Ended|
|Cost of sales||728,615||657,465||3,136,483||2,432,839|
|Gross profit as a percentage of net sales||51.8%||53.9%||50.3%||56.1%|
|Operating expenses as a percentage of net sales||25.8%||24.9%||25.2%||23.7%|
|Operating income as a percentage of net sales||26.1%||29.0%||25.1%||32.4%|
|Other (expense) income, net||(825||)||6,131||(12,757||)||3,952|
|Income before provision for income taxes¹||393,526||419,011||1,571,964||1,801,419|
|Provision for income taxes||91,853||97,697||380,340||423,944|
|Income taxes as a percentage of income before taxes||23.3%||23.3%||24.2%||23.5%|
|Net income as a percentage of net sales||19.9%||22.5%||18.9%||24.9%|
|Net income per common share:|
|Weighted average number of shares of common stock and common stock equivalents:|
|Energy drink case sales (in thousands) (in 192-ounce case equivalents)||166,227||153,450||701,677||613,441|
|Average net sales per case2||$||8.91||$||9.25||$||8.82||$||8.99|
1Includes $9.9 million and $10.2 million for the three-months ended December 31, 2022 and 2021, respectively, related to the recognition of deferred revenue. Includes $40.0 million and $41.5 million for the twelve-months ended December 31, 2022 and 2021, respectively, related to the recognition of deferred revenue.
2Excludes Alcohol segment net sales of
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Par Value) (Unaudited)
|Cash and cash equivalents||$||1,307,141||$||1,326,462|
|Accounts receivable, net||1,016,203||896,658|
|Prepaid expenses and other current assets||109,823||82,668|
|Prepaid income taxes||33,785||33,238|
|Total current assets||4,764,897||4,682,110|
|PROPERTY AND EQUIPMENT, net||516,897||313,753|
|DEFERRED INCOME TAXES||177,039||225,221|
|OTHER INTANGIBLE ASSETS, net||1,220,410||1,072,386|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Accrued promotional allowances||255,631||211,461|
|Income taxes payable||13,317||30,399|
|Total current liabilities||1,001,978||965,076|
|Common stock -
641,844 shares issued and 522,300 shares outstanding as of
640,043 shares issued and 529,323 shares outstanding as of
|Additional paid-in capital||4,780,013||4,652,620|
|Accumulated other comprehensive loss||(159,073||)||(69,165||)|
|Common stock in treasury, at cost; 119,544 and 110,720 shares as of
|Total stockholders’ equity||7,025,041||6,566,951|
|Total Liabilities and Stockholders’ Equity||$||8,293,105||$||7,804,784|
|Chairman and Co-Chief Executive Officer|
|Vice Chairman and Co-Chief Executive Officer|
Source: Monster Beverage Corporation