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8-K - 8-K - Monster Beverage Corpa12-11756_18k.htm

Exhibit 99.1

 

 

 

PondelWilkinson Inc.

 

1880 Century Park East, Suite 350

 

Los Angeles, CA 90067

 

 

Investor Relations

T

(310) 279 5980

Strategic Public Relations

F

(310) 279 5988

 

W

www.pondel.com

 

NEWS

RELEASE

CONTACTS:

Rodney C. Sacks

 

Chairman and Chief Executive Officer

 

(951) 739-6200

 

 

 

Hilton H. Schlosberg

 

Vice Chairman

 

(951) 739-6200

 

 

 

Roger S. Pondel / Judy Lin Sfetcu

 

PondelWilkinson Inc.

 

(310) 279-5980

 

MONSTER BEVERAGE REPORTS RECORD 2012 FIRST QUARTER FINANCIAL RESULTS

 

First Quarter Net Sales Rise 27.5% to $454.6 million;

First Quarter Net Income Increases 38.3% to $76.1 million —

 

Corona, CA — May 9, 2012 — Monster Beverage Corporation (NASDAQ:MNST) today reported record sales and profits for the first quarter ended March 31, 2012.

 

Gross sales for the 2012 first quarter increased 26.9 percent to $517.3 million from $407.6 million in the same period last year.  Net sales for the three-months ended March 31, 2012 increased 27.5 percent to $454.6 million from $356.4 million a year ago.

 

For the 2012 first quarter, gross profit as a percentage of net sales, was 53.1 percent, compared with 52.1 percent for the comparable 2011 quarter.  Operating expenses for the 2012 first quarter increased to $114.9 million from $97.1 million in the same quarter last year.

 

Distribution costs as a percentage of net sales were 4.3 percent for the 2012 first quarter, compared with 4.1 percent in the same quarter last year.

 

Selling expenses as a percentage of net sales for the 2012 first quarter were 12.3 percent, compared with 13.7 percent in the same quarter a year ago.

 

General and administrative expenses as a percentage of net sales for the 2012 first quarter were 8.7 percent, compared with 9.4 percent for the corresponding quarter last year.  Stock-based compensation (a non-cash item) was $6.6 million in the first quarter of 2012, compared with $3.8 million for the first quarter of 2011.

 

Operating income for the 2012 first quarter increased 42.8 percent to $126.3 million from $88.5 million in the comparable 2011 quarter.

 

The effective tax rate for the 2012 first quarter was 39.9 percent, compared with 38.0 percent in the same quarter last year.

 

(more)

 



 

Net income for the 2012 first quarter increased 38.3 percent to $76.1 million from $55.0 million in the same quarter last year.  Net income per diluted share increased 39.7 percent to $0.41 from $0.29 per diluted share in the 2011 comparable quarter.

 

Net sales for the Company’s DSD segment for the 2012 first quarter increased 28.8 percent to $431.2 million from $334.7 million for the same period in 2011.

 

Gross sales to customers outside the United States rose to $100.6 million in the 2012 first quarter, compared with $72.8 million in the corresponding quarter in 2011.

 

Rodney C. Sacks, chairman and chief executive officer, noted that the energy drink category in general, and the Monster Energy® brand in particular, have continued their positive growth trends.  “We are also excited that the growth that we previously reported for our Monster Rehab® line has continued unabated.  During the quarter, we launched our fifth product in the Monster Rehab® line,” Sacks said.  “We are continuing to expand into new international markets and retail sales of Monster Energy® commenced in Hong Kong and Macau during April and in Japan and Ecuador earlier this week. We are planning launches in additional international markets later this year,” Sacks added.

 

Investor Conference Call

 

The Company will host an investor conference call today, May 9, 2012, 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 Corporation

 

Based in Corona, California, Monster Beverage Corporation is a marketer and distributor of energy drinks and alternative beverages. The Company markets and distributes Monster Energy® brand energy drinks, Monster Energy Extra Strength Nitrous Technology® brand energy drinks, Java Monster® brand non-carbonated coffee + energy drinks, X-Presso Monster® brand non-carbonated espresso energy drinks, M-3™ superconcentrated energy drinks, Monster Rehab® non-carbonated rehydration energy drinks, Worx Energy® shots, and Peace Tea® iced teas, as well as Hansen’s® natural sodas, apple juice and juice blends, multi-vitamin juices, Junior Juice® beverages, Blue Sky® beverages, Hubert’s® Lemonades, Vidration® vitamin enhanced waters, and PRE® Probiotic drinks.  For more information visit www.monsterbevcorp.com.

 

#      #      #

 

Note Regarding Use of Non-GAAP Measures

 

Gross sales is used internally by management as an indicator of and to monitor operating performance, including sales performance of particular products, salesperson performance, product growth or declines and overall Company performance. The use of gross sales allows evaluation of sales performance before the effect of any promotional items, which can mask certain performance issues. We therefore believe that the presentation of gross sales provides a useful measure of our operating performance. Gross sales is not a measure that is recognized under generally accepted accounting principles in the United States of America (“GAAP”) and should not be considered as an alternative to net sales, which is determined in accordance with GAAP, and should not be used alone as an indicator of operating performance in place of net sales. Additionally, gross sales may not be comparable to similarly titled measures used by other companies, as gross sales has been defined by our internal reporting practices. In addition, gross sales may not be realized in the form of cash receipts as promotional payments and allowances may be deducted from payments received from certain customers.

 

(more)



 

Caution Concerning Forward-Looking Statements

 

Certain statements made in this announcement may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding the expectations of management with respect to our future operating results and other future events including revenues and profitability.  Management 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 current uncertainty and volatility in the national and global economy; changes in consumer preferences; changes in demand due to both domestic and international economic conditions; activities and strategies of competitors, including the introduction of new products and competitive pricing and/or marketing of similar products; potential distribution disruptions and/or decline in sales arising out of the termination and/or appointment of domestic and/or international distributors; changes in the price and/or availability of raw materials; other supply issues, including the availability of products and/or suitable production facilities; product distribution and placement decisions by retailers; changes in governmental regulation; the imposition of new and/or increased taxes on our products; political, legislative or other governmental actions or events in one or more regions in which we operate.  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. 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 SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER INFORMATION

FOR THE THREE-MONTHS ENDED MARCH 31, 2012 AND 2011

(In Thousands, Except Per Share Amounts) (Unaudited)

 

 

 

Three-Months Ended

 

 

 

March 31,

 

 

 

2012

 

2011

 

Gross sales, net of discounts and returns*

 

$

517,313

 

$

407,593

 

 

 

 

 

 

 

Less: Promotional and other allowances**

 

62,708

 

51,174

 

 

 

 

 

 

 

Net sales

 

454,605

 

356,419

 

 

 

 

 

 

 

Cost of sales

 

213,436

 

170,882

 

 

 

 

 

 

 

Gross profit

 

241,169

 

185,537

 

Gross profit margin as a percentage of net sales

 

53.1

%

52.1

%

 

 

 

 

 

 

Operating expenses

 

114,884

 

97,082

 

Operating expenses as a percentage of net sales

 

25.3

%

27.2

%

 

 

 

 

 

 

Operating income

 

126,285

 

88,455

 

Operating income as a percentage of net sales

 

27.8

%

24.8

%

 

 

 

 

 

 

Other income:

 

 

 

 

 

Interest and other (expense) income, net

 

(50

)

4

 

Gain on investments and put option, net

 

396

 

297

 

Total other income

 

346

 

301

 

 

 

 

 

 

 

Income before provision for income taxes

 

126,631

 

88,756

 

 

 

 

 

 

 

Provision for income taxes

 

50,532

 

33,713

 

 

 

 

 

 

 

Net income

 

$

76,099

 

$

55,043

 

Net income as a percentage of net sales

 

16.7

%

15.4

%

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

Basic

 

$

0.44

 

$

0.31

 

Diluted

 

$

0.41

 

$

0.29

 

 

 

 

 

 

 

Weighted average number of shares of common stock and common stock equivalents:

 

 

 

 

 

Basic

 

174,832

 

177,858

 

Diluted

 

185,262

 

187,248

 

 

 

 

 

 

 

Case sales (in thousands) (in 192-ounce case equivalents)

 

44,396

 

34,681

 

Average net sales per case

 

$

10.24

 

$

10.28

 

 


*Gross sales, although used internally by management as an indicator of operating performance, should not be considered as an alternative to net sales, which is determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”), and should not be used alone as an indicator of operating performance in place of net sales.  Additionally, gross sales may not be comparable to similarly titled measures used by other companies as gross sales has been defined by our internal reporting requirements. However, gross sales are used by management to monitor operating performance including sales performance of particular products, salesperson performance, product growth or declines and our overall performance. The use of gross sales allows evaluation of sales performance before the effect of any promotional items, which can mask certain performance issues. Management believes the presentation of gross sales allows a more comprehensive presentation of our operating performance. Gross sales may not be realized in the form of cash receipts as promotional payments and allowances may be deducted from payments received from customers.

 

** Although the expenditures described in this line item are determined in accordance with GAAP and meet GAAP requirements, the disclosure thereof does not conform with GAAP presentation requirements. Additionally, the presentation of promotional and other allowances may not be comparable to similar items presented by other companies. The presentation of promotional and other allowances facilitates an evaluation of the impact thereof on the determination of net sales and illustrates the spending levels incurred to secure such sales. Promotional and other allowances constitute a material portion of our marketing activities.

 



 

MONSTER BEVERAGE CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2012 AND DECEMBER 31, 2011

(In Thousands, Except Par Value) (Unaudited)

 

 

 

March 31,
2012

 

December 31,
2011

 

ASSETS

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

Cash and cash equivalents

 

$

391,438

 

$

359,331

 

Short-term investments

 

419,588

 

411,282

 

Trade accounts receivable, net

 

255,712

 

218,072

 

Distributor receivables

 

712

 

669

 

Inventories

 

179,127

 

155,613

 

Prepaid expenses and other current assets

 

19,654

 

20,912

 

Prepaid income taxes

 

1,804

 

370

 

Deferred income taxes

 

16,428

 

16,428

 

Total current assets

 

1,284,463

 

1,182,677

 

 

 

 

 

 

 

INVESTMENTS

 

21,864

 

23,194

 

PROPERTY AND EQUIPMENT, net

 

55,689

 

45,151

 

DEFERRED INCOME TAXES

 

56,003

 

58,576

 

INTANGIBLES, net

 

49,132

 

48,396

 

OTHER ASSETS

 

3,594

 

4,405

 

Total Assets

 

$

1,470,745

 

$

1,362,399

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

Accounts payable

 

$

134,035

 

$

113,446

 

Accrued liabilities

 

42,517

 

31,966

 

Accrued promotional allowances

 

56,943

 

87,746

 

Deferred revenue

 

11,751

 

11,583

 

Accrued compensation

 

6,569

 

10,353

 

Income taxes payable

 

36,302

 

10,996

 

Total current liabilities

 

288,117

 

266,090

 

 

 

 

 

 

 

DEFERRED REVENUE

 

115,300

 

117,151

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY:

 

 

 

 

 

Common stock - $0.005 par value; 240,000 shares authorized; 200,649 shares issued and 176,197 outstanding as of March 31, 2012; 198,729 shares issued and 174,277 outstanding as of December 31, 2011

 

1,003

 

994

 

Additional paid-in capital

 

238,908

 

229,301

 

Retained earnings

 

1,244,743

 

1,168,644

 

Accumulated other comprehensive income (loss)

 

908

 

(1,547

)

Common stock in treasury, at cost; 24,452 shares as of March 31, 2012 and December 31, 2011, respectively

 

(418,234

)

(418,234

)

Total stockholders’ equity

 

1,067,328

 

979,158

 

Total Liabilities and Stockholders’ Equity

 

$

1,470,745

 

$

1,362,399