Montreal, Québec – GURU Organic Energy Corp., Canada’s leading organic energy drink brand, is pleased to announce its results for the second quarter and six-month period ended April 30, 2021. All amounts are expressed in Canadian dollars unless otherwise indicated.
“We are proud to have delivered another record quarter, with a 74% increase in sales and gross margins of 63%. Online sales also continue to perform very well in both Canada and the U.S., driven by evolving consumer behaviours throughout the pandemic and as a result of our consumer acquisition investments over the last several quarters,” said Carl Goyette, President and CEO of GURU.
“Since the beginning of the fiscal year, we have grown our retail presence by 6,100 points of sale to over 21,000. In addition to the 5,300 doors announced in Q1, we recently confirmed an additional 800 doors in The Fresh Market, Weis Markets and Raleys in the U.S. and in Canadian Tire Gas+ in Canada. With the addition of The Fresh Market, we have now fully penetrated the U.S. natural channel, further strengthening our health and wellness positioning. We were also pleased to launch GURU Yerba Mate in the U.S. on June 1, our latest innovation and the top-performing energy drink in our core market of Quebec. The expansion of our organic product selection will only enhance our brand visibility and positioning in the U.S. market.”
“We will continue to leverage the strength of our brand and strong demand for healthy alternatives in the fast-growing energy drink market, as we continue to execute our roll-out plans in Canada and the U.S. throughout the summer. This will be supported by our solid financial position and impactful marketing and sales activations,” added Mr. Goyette.
Results of operations
Revenue increased by 74% to $7.1 million in the second quarter, compared to $4.1 million for the same period a year ago. The increase is due to sales growth in Canada and the U.S. as a result of increased points of sale in both markets. Sales in Canada and the U.S. grew 89% and 22%, respectively, during the second quarter of fiscal 2021 compared to the same period last year. The comparative quarter also coincided with the onset of the COVID-19 pandemic, which negatively affected sales in that period. For the six-month period, revenue increased by 46% to $13.7 million, up from $9.4 million for the same period in 2020.
Gross profit totaled $4.4 million in the second quarter, an increase of 82% compared to $2.4 million last year. Gross margin was 63% compared to 60% for the same period a year ago. The increase in gross margin was due to a stronger product mix and the timing of promotional activities, that compensated for the higher product costs driven by increased demand for ready-to-drink beverages since the onset of the COVID 19 pandemic. For the six-month period, gross profit increased to $8.5 million from $6.0 million a year ago. Gross margin for the period was 62%, compared to 64% last year.
Selling, general and administrative expenses (“SG&A”), which include operational, sales, marketing and administration costs, amounted to $5.5 million or 78% of revenue in the second quarter, compared to SG&A of $3.2 million or 80% of revenue for the same period a year ago. The increase in dollars is the result of expansion plan set-up costs and additional costs associated with the operations of a public company. For the six-month period, SG&A amounted to $10.2 million (75% of revenue), compared to $6.1 million (65% of revenue) for the same period a year ago.
Adjusted EBITDA amounted to $(0.8) million compared to $(0.7) million last year. The decrease in adjusted EBITDA was due to higher SG&A, partially offset by the increase in gross profit. Adjusted EBITDA for the first six months of the year was $(1.3) million in 2021 compared to earnings of $0.1 million in 2020.
Net loss for the second quarter totalled $1.2 million or $(0.04) per share (basic and diluted), compared to a net loss of $0.7 million or $(0.03) per share (basic and diluted) for the same period a year ago. The majority of the net loss reflects the additional costs associated with operating as a public company and the set-up of our expansion plans. Net loss for the six-month period totalled $1.8 million in 2021, or $(0.06) per share (basic and diluted), compared to a net loss of $0.2 million or $(0.01) per share (basic and diluted) for the same period a year ago.
As of April 30, 2021, the Company had cash and cash equivalents of $24.1 million and unused $CA and $US denominated credit facilities totalling $10 million.
Second quarter 2021 conference call
GURU will now hold a conference call to discuss its second quarter 2021 results today, June 14, 2021, at 4:45 p.m.ET, instead of 5:30 p.m. ET as previously announced. Interested parties can listen in by accessing the live audio webcast at investors.guruenergy.com/en/ir-corner or by dialling 833-678-0822 (North America) or 602-563-8278 (International). Participants will need to provide the following Conference ID Number: 5750898. A webcast replay will be available on GURU’s website until June 14, 2022.
About GURU
GURU Organic Energy Corp. (TSX: GURU) is a dynamic, fast-growing beverage company launched in 1999, when it pioneered the world’s first natural, plant-based energy drink. The Company markets organic energy drinks in Canada and the United States through a distribution network of more than 21,000 points of sale, and through guruenergy.com and Amazon. GURU has built an inspiring brand with a clean list of organic plant-based ingredients. Its drinks offer consumers good energy that never comes at the expense of their health. The Company is committed to achieving its mission of cleaning the energy drink industry in Canada and the United States.
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