Boca Raton, FL (August 10, 2015) – Celsius Holdings, Inc., (Other OTC: CELH) the creator and marketer of Celsius®, the world’s first and only negative calorie and fat burning beverage backed by clinical science, today reported results for the second quarter of 2015.
Second Quarter 2015 Financial Highlights Include:
- Revenue grew 71% to $4.66 million, from $2.73 million in the second quarter of last year
- International revenue grew 112% to $2.28 million, from $1.08 million in the comparable 2014 period
- Domestic revenue increased 44% to $2.37 million, from $1.65 million last year
- Gross profit margins improved to 43.5% from 39.3% in last year’s quarter
- Net Loss amounted to ($595,000), as compared to a loss of ($756,000) in the prior year
- Non-GAAP Adjusted EBITDA*, excluding interest, stock based compensation, and depreciation expenses, increased to $433,000 from ($481,000) in the comparable 2014 period
- Working capital has increased to $15.04 million, up from $3.54 million at December 31, 2014
Year-to-Date Highlights – Comparison of Six Months Ended June 30, 2015 and 2014 Include:
- Revenue grew 41% to $9.30 million, compared to $6.60 million in the prior year
- International revenue grew 62% to $5.45 million, from $3.56 million in the comparable 2014 period
- Domestic revenue increased 19% to $3.86 million, from $3.24 million last year
- Gross profit margins improved to 41.6% from 37.2% in the prior year
- Net Loss amounted to ($382,000), as compared to a net loss of ($1,459,000) last year
- Non-GAAP Adjusted EBITDA*, excluding interest, stock based compensation, and depreciation expenses, increased to $993,000 from ($752,000) in the comparable 2014 period
“We achieved continued record revenue growth with second quarter revenues growing to $4.66 million. Growth in existing international accounts highlighted the quarter growing 112% and domestically sales grew 44%. During the quarter all domestic sales channels grew over 37% with the health & fitness channel growing 55% during the period. Our recent expansion in Gold’s Gym and Life Time Fitness during the quarter further reinforces Celsius as the #1 beverage choice for the health conscious consumer. We continue to focus on national and regional grocery chains, as well as convenience stores throughout the United States,” said Mr. Gerry David, Chief Executive Officer. “Our recent strategic partnership and equity investment led by Mr. Li Ki-Shing’s Horizons Ventures, Mr. Russell Simmons and Ms. Kimora Lee Simmons has broadened our reach across consumer channels and further strengthens our position in both domestic and global markets. We are investing heavily in our domestic marketing and sales initiatives through new marketing programs and the expansion of our “drill deep” markets. We are aggressively pursuing co-marketing opportunities with highly regarded complimentary brands,” David continued. “These are very exciting times at Celsius as consumers around the world seek out our one of a kind product.”
Three Months Ended June 30, 2015 Compared to Three Months Ended June 30, 2014
Revenue
Net revenue for the three months ended June 30, 2015 and 2014 was approximately $4.65 million and $2.73 million, respectively, or an increase of 71%. This increase was associated with growth in international sales of 112% or $1,206 thousand from existing accounts versus the same period in 2014, respectively. Domestic sales increased 44% or $720 thousand primarily associated with growth in direct domestic retail accounts of 43%, health & fitness accounts increased 55% and internet retailers grew 37% versus the same period in 2014, respectively.
Gross profit
Gross Profit was $2.03 million in the second quarter of 2015 as compared to $1.07 million for the same period in 2014. Gross profit margins improved 4.2% to 43.6% in the second quarter of 2015 versus the same period in 2014. We continue to remain focused on improving and maintaining gross profit margins.
Operating expenses
Sales and marketing expenses for the three months ended June 30, 2015 and 2014 was approximately $1.14 million and $1.14 million, respectively. General and administrative expenses for the three months ended June 30, 2015 and 2014 was approximately $1.33 million and $536 thousand, an increase of $793 thousand, respectively. This increase was mainly due to increased expense for stock based compensation increasing $758 thousand and investments in human resources and R&D testing, versus the prior period.
Other expense
Total other expense decreased to $75,000 for the second quarter of 2015 from $120,000 for the same three-month period in 2014, or $45,000 savings in interest expense.
Six Month Ended June 30, 2015 Compared to Six Months Ended June 30, 2014
Revenue
Net revenue for the six months ended June 30, 2015 and 2014 was approximately $9.3 million and $6.6 million, respectively. The increase of 41% was mainly associated with a 62% growth in international sales and a 19% growth in domestic sales. Domestic sales growth of 19% was mainly associated with a 19% growth rate in direct domestic retail and health & fitness accounts as well as internet retailers growing 21% versus the same period in the prior year, respectively.
Gross profit
Gross Profit was $3.87 million in the six months ended June 30, 2015 as compared to $2.46 million for the same period in 2014. Gross Profit margins improved 4.3% to 41.6% in the six months ended June 30, 2015 versus the same period in 2014. We continue to remain focused on improving and maintaining gross profit margins.
Operating expenses
Sales and marketing expenses decreased to $2.04 million for the six months period ended June 30, 2015 from $2.63 million for the same six-month period in 2014, or a decrease of $593 thousand. This was mainly due to timing in marketing programs and savings in celebrity endorsements, broker fees and other sales support, offset by investments in human resources. General and administrative expenses increased $910,000 to $1.9 million for the six months period ended June 30, 2015 from $1.0 million for the same six-month period in 2014, respectively. This increase was mainly due to increased expense for stock based compensation of $850,000, increased professional fees and investments in human resources.
Other expense
Total other expense decreased to $207,000 for the six months period ended June 30, 2015 from $233,000 for the same six-month period in 2014, or $26,000 savings in interest expense.
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Celsius Holdings, Inc. and Subsidiaries | ||||||||||
| Consolidated Balance Sheets (Unaudited) | ||||||||||
| June 30, 2015 | December 31, 2014 | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 11,643,193 | $ | 349,072 | ||||||
| Accounts receivable, net | 2,074,740 | 2,612,191 | ||||||||
| Inventories, net | 1,445,170 | 1,686,935 | ||||||||
| Prepaid expenses and other current assets | 1,187,979 | 259,056 | ||||||||
| Total current assets | 16,351,082 | 4,907,254 | ||||||||
| Property, fixtures and equipment, net | 26,099 | 43,950 | ||||||||
| Total Assets | $ | 16,377,181 | $ | 4,951,204 | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT) | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable and accrued expenses | $ | 1,154,251 | $ | 828,049 | ||||||
| Accrued preferred dividend | 108,345 | 180,403 | ||||||||
| Deferred revenue and other current liabilities | 50,051 | 356,602 | ||||||||
| Total current liabilities | 1,312,647 | 1,365,054 | ||||||||
| Long-term liabilities | ||||||||||
| Convertible note payable, related party | – | 1,500,000 | ||||||||
| Note payable-related party | 4,500,000 | 9,250,000 | ||||||||
| Total Liabilities | 5,812,647 | 12,115,054 | ||||||||
| Stockholders’ Equity (Deficit): | ||||||||||
| Preferred Stock, $0.001 par value; 2,500,000 shares authorized, 6,380 and 2,200 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively. | 6 | 2 | ||||||||
| Common stock, $0.001 par value; 75,000,000 shares authorized, 38,380,380 and 20,459,032 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively | 38,380 | 20,459 | ||||||||
| Additional paid-in capital | 58,258,291 | 40,165,955 | ||||||||
| Accumulated deficit | (47,732,143) | (47,350,266) | ||||||||
| Total Stockholders’ Equity (Deficit) | 10,564,534 | (7,163,850) | ||||||||
| Total Liabilities and Stockholders’ Equity (Deficit) | $ | 16,377,181 | $ | 4,951,204 | ||||||
Celsius Holdings, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
| For the three months ended June 30, | For the six months | |||||||
| Ended June 30, | ||||||||
| 2015 | 2014 | 2015 | 2014 | |||||
| Revenue | $ | 4,655,884 | $ | 2,729,525 | $ | 9,304,910 | $ | 6,597,009 |
| Cost of revenue | 2,627,796 | 1,656,450 | 5,438,221 | 4,140,984 | ||||
| Gross profit | 2,028,088 | 1,073,075 | 3,866,689 | 2,456,025 | ||||
| Selling and marketing expenses | 1,144,016 | 1,140,003 | 2,042,506 | 2,634,753 | ||||
| General and administrative expenses | 1,329,150 | 535,901 | 1,891,385 | 981,620 | ||||
| Total operating expense | 2,473,166 | 1,675,904 | 3,933,891 | 3,616,373 | ||||
| Income (Loss) from operations | (445,078) | (602,829) | (67,202) | (1,160,348) | ||||
| Other Income (Expense): | ||||||||
| Interest expense, net | (74,564) | (119,863) | (206,733) | (232,603) | ||||
| Total Other Income (Expense) | (74,564) | (119,863) | (206,733) | (232,603) | ||||
| Net Income (Loss) | $ | (519,642) | $ | (722,692) | $ | (273,935) | $ | (1,392,951) |
| Accrued preferred stock dividend | (74,941) | (33,367) | (107,942) | (66,368) | ||||
| Net Income (Loss) available to common stockholders | $ | (594,583) | $ | (756,059) | $ | (381,877) | $ | (1,459,319) |
| Income (Loss) per share: | ||||||||
| Basic | $ | (0.02) | (0.04) | $ | (0.01) | $ | (0.07) | |
| Diluted | $ | (0.02) | (0.04) | $ | (0.01) | $ | (0.07) | |
| Weighted average shares outstanding: | ||||||||
| Basic | 35,229,375 | 20,429,032 | 27,885,006 | 20,332,347 | ||||
| Diluted | 35,229,375 | 20,429,032 | 27,885,006 | 20,332,347 | ||||
About Celsius Holdings, Inc.
Celsius Holdings Inc. (OTC: CELH) is a science-based functional beverage company, founded in April 2004. Celsius is the world’s first and only negative calorie and fat burning drink. Backed by multiple clinical studies, drinking Celsius before activity has been proven to help burn up to 93% more body fat, burn 100 calories and more per serving, boost metabolism, provide clean energy and accelerate results of any weight-loss program. It comes in five delicious flavors, carbonated and non-carbonated, and also in powder stick packets that can be mixed with water. Celsius contains no sugar, no gluten, no high-fructose corn syrup, no aspartame, no preservatives, no artificial flavors or colors, and is low in sodium. The first clinical study was conducted in 2005. Five additional studies from the University of Oklahoma, were conducted over the next five years. All six studies were published in peer reviewed journals and validated the unique benefits Celsius provides to the consumer. For more information, please visit www.celsius.com.