UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
of the Securities Exchange Act of 1934
For the quarterly period ended | Commission File Number |
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) |
(Address of principal executive offices) (Zip code)
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(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Accelerated filer ☐ | |||
Non-accelerated filer ☐ | Smaller reporting company | ||
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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The registrant had
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
JUNE 30, 2023
INDEX
2
PART I – FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 2023 AND DECEMBER 31, 2022
(In Thousands, Except Par Value) (Unaudited)
June 30, | December 31, | |||||
| 2023 |
| 2022 | |||
ASSETS | ||||||
CURRENT ASSETS: | ||||||
Cash and cash equivalents | $ | | $ | | ||
Short-term investments |
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Accounts receivable, net |
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Inventories |
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Prepaid expenses and other current assets |
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Prepaid income taxes |
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Total current assets |
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INVESTMENTS |
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PROPERTY AND EQUIPMENT, net |
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DEFERRED INCOME TAXES, net |
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GOODWILL |
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OTHER INTANGIBLE ASSETS, net |
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OTHER ASSETS |
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Total Assets | $ | |
| $ | | |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||
CURRENT LIABILITIES: | ||||||
Accounts payable | $ | |
| $ | | |
Accrued liabilities |
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Accrued promotional allowances |
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Deferred revenue |
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Accrued compensation |
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Income taxes payable |
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Total current liabilities |
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DEFERRED REVENUE |
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OTHER LIABILITIES | | | ||||
COMMITMENTS AND CONTINGENCIES (Note 11) | ||||||
STOCKHOLDERS’ EQUITY1: | ||||||
Common stock - $ | | | ||||
Additional paid-in capital |
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Retained earnings |
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Accumulated other comprehensive loss |
| ( |
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| ( | |
Common stock in treasury, at cost; |
| ( |
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| ( | |
Total stockholders’ equity |
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Total Liabilities and Stockholders’ Equity | $ | |
| $ | |
1 Stock Split - On February 28, 2023, the Company announced a two-for-one stock split of its common stock to be effected in the form of a 100% stock dividend. The stock dividend was issued on March 27, 2023 (the “Stock Split”). The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information.
See accompanying notes to condensed consolidated financial statements.
3
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE- AND SIX-MONTHS ENDED JUNE 30, 2023 AND 2022
(In Thousands, Except Per Share Amounts) (Unaudited)
Three-Months Ended | Six-Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
| 2023 |
| 2022 |
| 2023 |
| 2022 | |||||
NET SALES | $ | | $ | | $ | | $ | | ||||
COST OF SALES |
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GROSS PROFIT |
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OPERATING EXPENSES |
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OPERATING INCOME |
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INTEREST and OTHER INCOME (EXPENSE), net |
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| ( |
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| ( | ||||
INCOME BEFORE PROVISION FOR INCOME TAXES |
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PROVISION FOR INCOME TAXES | | | | | ||||||||
NET INCOME | $ | | $ | | $ | | $ | | ||||
NET INCOME PER COMMON SHARE1: | ||||||||||||
Basic | $ | | $ | | $ | | $ | | ||||
Diluted | $ | | $ | | $ | | $ | | ||||
WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK AND COMMON STOCK EQUIVALENTS1: | ||||||||||||
Basic |
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Diluted |
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¹ Stock Split - The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information.
See accompanying notes to condensed consolidated financial statements.
4
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE THREE- AND SIX-MONTHS ENDED JUNE 30, 2023 AND 2022
(In Thousands) (Unaudited)
Three-Months Ended |
| Six-Months Ended | ||||||||||
June 30, | June 30, | |||||||||||
| 2023 |
| 2022 |
| 2023 |
| 2022 | |||||
Net income, as reported | $ | | $ | | $ | | $ | | ||||
Other comprehensive income (loss): | ||||||||||||
Change in foreign currency translation adjustment |
| ( |
| ( |
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| ( | ||||
Available-for-sale investments: | ||||||||||||
Change in net unrealized gains (losses) |
| ( |
| ( |
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| ( | ||||
Net losses on commodity derivatives |
| ( |
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| ( |
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Other comprehensive income (loss) |
| ( |
| ( |
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| ( | ||||
Comprehensive income | $ | | $ | | $ | | $ | |
See accompanying notes to condensed consolidated financial statements.
5
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR THE THREE- AND SIX-MONTHS ENDED JUNE 30, 2023 AND 2022
(In Thousands) (Unaudited)
Accumulated Other | Total | |||||||||||||||||||||
Common stock | Additional | Retained | Comprehensive | Treasury stock | Stockholders’ | |||||||||||||||||
| Shares |
| Amount |
| Paid-in Capital |
| Earnings |
| (Loss) Income |
| Shares |
| Amount |
| Equity | |||||||
Balance, December 31, 2022 | | $ | | $ | | $ | | $ | ( | ( | $ | ( | $ | | ||||||||
| ||||||||||||||||||||||
Stock-based compensation |
| — | — | | — | — | — | — | | |||||||||||||
Stock options/awards |
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| — |
| — |
| — |
| — |
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Unrealized gain (loss), net on available-for-sale securities |
| — | — | — | — | | — | — | | |||||||||||||
Repurchase of common stock | — | — | — | — | — | ( | ( | ( | ||||||||||||||
Retirement of treasury stock | ( | ( | | ( | — | | | — | ||||||||||||||
Foreign currency translation |
| — | — | — | — | | — | — | | |||||||||||||
Net income |
| — | — | — | | — | — | — | | |||||||||||||
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Balance, March 31, 2023 |
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| $ | |
| $ | |
| $ | |
| $ | ( | ( |
| $ | ( |
| $ | | |
| ||||||||||||||||||||||
Stock-based compensation | — | — | | — | — | — | — | | ||||||||||||||
Stock options/awards |
| | | | — | — | — | — | | |||||||||||||
Unrealized gain (loss), net on available-for-sale securities |
| — |
| — |
| — |
| — |
| ( |
| — |
| — |
| ( | ||||||
Repurchase of common stock |
| — | — | — | — | — | ( | ( | ( | |||||||||||||
Foreign currency translation | — | — | — | — | ( | — | — | ( | ||||||||||||||
Net losses on commodity derivatives |
| — | — | — | — | ( | — | — | ( | |||||||||||||
Net income | — | — | — | | — | — | — | | ||||||||||||||
| ||||||||||||||||||||||
Balance, June 30, 2023 | | $ | | $ | | $ | | $ | ( | ( | $ | ( | $ | |
Accumulated Other | Total | |||||||||||||||||||||
Common stock | Additional | Retained | Comprehensive | Treasury stock | Stockholders’ | |||||||||||||||||
| Shares |
| Amount |
| Paid-in Capital |
| Earnings |
| (Loss) Income |
| Shares |
| Amount |
| Equity | |||||||
Balance, December 31, 2021 | | $ | | $ | | $ | | $ | ( | ( | $ | ( | $ | | ||||||||
Stock-based compensation |
| — | — | | — | — | — | — | | |||||||||||||
Stock options/awards |
| | | | — | — | — | — | | |||||||||||||
Unrealized gain (loss), net on available-for-sale securities |
| — |
| — |
| — |
| — |
| ( |
| — |
| — |
| ( | ||||||
Repurchase of common stock | — | — | — | — | — | ( | ( | ( | ||||||||||||||
Foreign currency translation |
| — | — | — | — | | — | — | | |||||||||||||
Net income |
| — | — | — | | — | — | — | | |||||||||||||
| ||||||||||||||||||||||
Balance, March 31, 2022 |
| | $ | | $ | | $ | | $ | ( | ( | $ | ( | $ | | |||||||
Stock-based compensation |
| — |
| — |
| |
| — |
| — | — |
| — |
| | |||||||
Stock options/awards | | | | — | — | — | — | | ||||||||||||||
Unrealized gain (loss), net on available-for-sale securities |
| — | — | — | — | ( | — | — | ( | |||||||||||||
Repurchase of common stock |
| — | — | — | — | — | ( | ( | ( | |||||||||||||
Foreign currency translation |
| — |
| — |
| — |
| — |
| ( |
| — |
| — |
| ( | ||||||
Net income |
| — | — | — | | — | — | — | | |||||||||||||
Balance, June 30, 2022 | | $ | | $ | | $ | | $ | ( | ( | $ | ( | $ | |
¹ Stock Split - The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information.
See accompanying notes to condensed consolidated financial statements.
6
MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX-MONTHS ENDED JUNE 30, 2023 AND 2022
(In Thousands) (Unaudited)
Six-Months Ended | ||||||
June 30, | ||||||
| 2023 |
| 2022 | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net income | $ | | $ | | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
Depreciation and amortization | | | ||||
Non-cash lease expense | | | ||||
Gain on disposal of property and equipment | ( | ( | ||||
Loss on impairment of intangibles | | | ||||
Stock-based compensation | | | ||||
Deferred income taxes | | | ||||
Effect on cash of changes in operating assets and liabilities net of acquisition: | ||||||
Accounts receivable | ( | ( | ||||
Inventories | | ( | ||||
Prepaid expenses and other assets | ( | ( | ||||
Prepaid income taxes | ( | ( | ||||
Accounts payable | | | ||||
Accrued liabilities | | ( | ||||
Accrued promotional allowances | | | ||||
Accrued compensation | ( | ( | ||||
Income taxes payable | ( | ( | ||||
Other liabilities | ( | ( | ||||
Deferred revenue | ( | ( | ||||
Net cash provided by operating activities | | | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Sales of available-for-sale investments | | | ||||
Purchases of available-for-sale investments | ( | ( | ||||
Acquisition of CANarchy, net of cash | | ( | ||||
Purchases of property and equipment | ( | ( | ||||
Proceeds from sale of property and equipment | | | ||||
Additions to intangibles | ( | ( | ||||
Increase in other assets | ( | ( | ||||
Net cash used in investing activities | ( | ( | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
(Payments) borrowings on debt | ( | | ||||
Issuance of common stock | | | ||||
Purchases of common stock held in treasury | ( | ( | ||||
Net cash used in financing activities | ( |