Vita Coco is officially going public. The New York-based coconut water maker filed on Monday with the U.S. Securities and Exchange Commission for an IPO seeking to raise up to $100 million. The company intends to list on the NASDAQ under the ticker symbol COCO.
The move is accompanied by a corporate rebrand, with the company changing its name from All Market Inc. to The Vita Coco Company.
“Today’s global beverage market is controlled mainly by behemoths who generate most of their profits from products that are not necessarily healthy for people or the planet,” co-founder and co-CEO Mike Kirban wrote in the filing. “21st century consumers seek products and brands that are not only good for their bodies but better for society. Our values of aligning profit with purpose really resonates with our consumers. We are humbled by their trust and loyalty, and they motivate us to do better every day.”
Kirban noted that Vita Coco still sees “enormous” white space to grow its household penetration and distribution footprint, with additional opportunities to expand through innovation. The filing notes that the company believes it has “an opportunity to grow distribution by approximately two fold with the Vita Coco brand alone,” thanks to strong sales velocities. As well, the filing highlights Vita Coco’s shift in April to become a public benefit corporation, which requires the company to balance the financial interests of stockholders with a social mission to support local communities in countries where it sources its coconuts, as well as environmental standards.
The filing comes several months after a June report that suggested Vita Coco was exploring an IPO with a potential valuation of $2 billion. The rumor came as the coconut water category rebounded from declining sales, in large part driven by double-digit growth from Vita Coco.
Founded in 2004 by Kirban and Ira Liran, who serves as the brand’s director of sourcing, Vita Coco is backed by a number of investment firms including Verlinvest, Strand Equity and Reignwood Group, the latter of which purchased a 25% stake in 2014. Other early investors include CAVU Ventures co-founder Rohan Oza and celebrities Madonna, Rihanna, Matthew McConaughey and Demi Moore.
The filing does not state how many shares of common stock the company intends to issue or an estimated price per share. Underwriters for the company’s IPO included Goldman Sachs, Bank of America Securities, Credit Suisse, Evercore ISI, Wells Fargo Securities, Guggenheim Securities, Piper Sandler and William Blair.
According to the company, Vita Coco sales have increased 24% over the 52-week period ending September 5, per IRI data for MULO and the convenience channel. About 36% of the brand’s 2020 sales came from the food, drug and mass channels, 35% in club and 29% in “Other” channels including ecommerce, convenience and food service. For distribution, 47% of the brand’s sales are through DSD, 47% through direct to warehouse and 6% broadline.
For the trailing 12 months ending June 30, The Vita Coco Company reported net sales of $334 million, up 17% year-over-year. For the year ended December 31, 2020, the company reported net sales of $311 million, up 9% from $284 million in 2019. Gross profit in 2020 was $105 million, a 13% increase. Net income grew 247% in 2020 to $33 million. Adjusted EBITDA in 2020 was $35 million, up 75%.
The Vita Coco brand has seen its strongest retail sales growth in the convenience channel, up 27% in the last 52 weeks and up 55% in the past 26 weeks. The drug channel has also seen a recent surge, up just 9% over the 52-week period and growing 40% in the 26-week period. MULO sales rose 23% in the 52-week period and 28% in the 26-week period, while food service growth remained steady at 18% in the full year and 19% for 26 weeks.
“We believe we have an opportunity in large format accounts to increase the number of items per store by maximizing our core item distribution in regional chains as well as the introduction of multipacks and new product lines such as our premium Farmers Organic, which highlights our sustainable sourcing, and [coconut water with MCTs line] Vita Coco Boosted,” the company wrote. “In addition, we see a large opportunity to increase the number of doors in the convenience channel, where Vita Coco remains under distributed with only 55% [ACV] according to IRI.”
For the six month period ending June 30, 15% of net sales were international and the company said it aims to further expand its global presence. Currently, 60% of international sales are in Europe, 15% in Asia Pacific and 25% in other regions, including private label products and commodities.
While the Vita Coco brand has expanded in recent years into multiple categories, including CBD, plant-based milks and hydration powders, the company has also sought to emphasize its positioning as a multi-brand platform. In addition to expanding its private label coconut water business in 2016, the company has also acquired energy drink Runa and created aluminum bottled water brand Ever & Ever and most recently debuted post-workout recovery drink PWR LIFT. However, coconut water remains the core sales driver for the company, accounting for 84% of all revenue in 2020 and 88% of all revenue in the six month period ending June 30, 2021.
The company also touted its close partnerships with its coconut suppliers, including manufacturers in the Philippines, Sri Lanka, Malaysia, Thailand, Brazil, Indonesia and Vietnam, however noted that these close-knit relationships may also be a potential risk factor for investors should disruptions in supply occur.
At last week’s Natural Products Expo East 2021 trade show, the brand showcased its product slate for 2022, which includes a revamp of Vita Coco Boosted (now Vita Coco Energy) and a new format and formulation for Runa.
Vita Coco is the latest better-for-you food and beverage maker to file for an IPO, as numerous brands have moved to go public over the past two years, including Oatly, Flow Alkaline Spring Water, Zevia, Chobani and Dole.