Exhibit 99.1
NEW AGE BEVERAGES CORPORATION ANNOUNCES
1st
QUARTER 2019 NET REVENUE GROWTH OF 404%
DENVER, COLORADO, May 9, 2019 – NEW AGE BEVERAGES CORPORATION
(NASDAQ: NBEV), the Colorado
and Utah-based organic and natural beverage company intending to
become the world’s leading healthy beverages and lifestyles
company, today announced financial results for the first quarter
ended March 31, 2019, with gross revenues increasing to $60.5
million compared to $12.8 million in the prior year. Net revenues
reached $58.3 million compared $11.6 million in Q1 of the prior
year, an increase of 404%. New Age’s cash balance increased
to $110.0 million and total assets increased to $349.5
million.
KEY HIGHLIGHTS:
-
Gross revenue reached $60.5 million, up $47.7 million vs. prior
year. Net Revenue increased to $58.3 million, up 404%.
-
Balance sheet significantly strengthened with $110.0 million in
cash versus $42.5 million at year end, and total assets of $349.5
million versus $286.9 million on December 31, 2018
-
Positive Operating Cash Flow of $11.4 million and EBITDA of $0.6
million
-
New credit facility emplaced
with East West Bank totalling $25.0 million at ≈6% annual
interest.
Brent Willis, Chief Executive Officer of New Age stated, “We
are pleased with our first quarter operating results, especially in
light of the fact that we were in the midst of integrating Morinda
into New Age. With our strengthened balance sheet and financial
flexibility, we look to accelerate our business in the second half
of 2019, buttressing our organic growth coming from the launch of
our CBD portfolio, our brands now entering national distribution in
the US, and a number of other initiatives launching in the second
quarter and throughout the rest of the year.”
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Q1 2019 FINANCIAL RESULTS
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For the three-month period ended March 31, 2019, gross revenues
reached $60.5 million versus $12.8 million in the prior year. Net
revenues less discounts, returns and billbacks reached $58.3
million versus $11.6 million in the prior year, an increase of
404%.
Gross profit for the 1st
quarter reached $38.6 versus $2.6
million in the prior year, an increase of 1,375%. As a percent of
net sales, gross margin increased to 66% versus 23% in the prior
year, primarily due to mix and the combination with Morinda which
was completed on December 21, 2018.
Total operating expenses for the quarter were $47.1 million due
primarily to the increased selling, general, and administrative
expenses associated with the merger with Morinda. Included in the
total operating expense is $5.5 million of non-cash
expenses.
Net Loss improved to $1.6 million loss versus a $2.7 million loss
in the first quarter of 2018, an improvement of 39%. EBITDA
increased to $0.6 million compared to a loss of $2.1 million in the
prior year.
Cash flows from operations increased to $11.4 for the quarter March
31, 2019 and compared to a loss of $0.1 million in the prior year,
and total assets increased to $349.5 million, an increase of 22%
vs. total assets at the end of 2018.
About New
Age Beverages Corporation (NASDAQ: NBEV)
New Age Beverages Corporation is a Colorado and Utah-based healthy
beverage company dedicated to inspiring and educating consumers to
“live healthy”. The Company is the only omni-channel
company with access to traditional retail, e-commerce,
direct-to-consumer, and medical channels across 60 countries around
the world. New Age is also the only one-stop-shop of healthy
beverages and includes the brands Tahitian Noni, TeMana, Búcha
Live Kombucha, XingTea, Coco-Libre, Marley, ‘NHANCED and
others. New Age competes in the growth segments of the >$1
trillion-dollar non-alcoholic beverage industry and has become one
of the largest non-alcoholic beverage companies, one of the largest
healthy beverage companies, and one of the fastest growing in the
world over the past three years. The Company’s brands are
sold across all 50 states within the US and in more than 60
countries internationally across all channels via a hybrid of
direct-to-consumer and traditional distribution and route-to-market
systems.
The Company operates the websites www.newagebev.com,
www.newagebev.us,
www.morinda.com,
www.mybucha.com,
www.xingtea.com,
www.drinkmarley.com,
www.nhancedcbd.com, and
www.cocolibre.com.
New Age has exclusively partnered with the world's 5th largest
water charity, WATERisLIFE, to end the world water crisis with the
most innovative technologies available. Donate at WATERisLIFE.com
to help us #EnditToday.
Safe Harbor Disclosure
This press release contains forward-looking statements that are
made pursuant to the safe harbor provisions 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.
Forward-looking statements are any statement reflecting
management's current expectations regarding future results of
operations, economic performance, financial condition and
achievements of the Company including statements regarding New Age
Beverage’s expectation to see growth. The forward-looking
statements are based on the assumption that operating performance
and results will continue in line with historical results.
Management believes these assumptions to be reasonable but there is
no assurance that they will prove to be accurate. Forward-looking
statements, specifically those concerning future performance are
subject to certain risks and uncertainties, and actual results may
differ materially. New Age Beverages competes in a rapidly growing
and transforming industry, and other factors disclosed in the
Company's filings with the Securities and Exchange Commission might
affect the Company’s operations. Unless required by
applicable law, NBEV undertakes no obligation to update or revise
any forward-looking statements.
For investor inquiries about New Age Beverages
Corporation please
contact:
Media:
Desiree
Rosa
MULTIPLY
Tel:
202-292-4566
NewAgeBev@wearemultip.ly
Investor Relations Counsel:
Cody
Slach, Liolios Group, Inc.
Tel
949-574-3860
NBEV@Liolios.com
New Age Beverages Corporation:
Greg
Gould
Chief
Financial Officer
Tel
303-289-8655
GGould@NewAgeBev.com
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NEW AGE BEVERAGES CORPORATION
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(In thousands, except par value per share amounts)
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March
31,
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December
31,
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ASSETS
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2019
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2018
|
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Current assets:
|
|
|
|
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Cash
and cash equivalents
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$109,956
|
$42,517
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|
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Accounts
receivable, net of allowance of $107 and $134,
respectively
|
9,450
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9,837
|
|
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Inventories
|
39,618
|
37,148
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Prepaid
expenses and other
|
6,607
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6,473
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Total
current assets
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165,631
|
95,975
|
|
|
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Long-term assets:
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Identifiable
intangible assets, net
|
66,553
|
67,830
|
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Property
and equipment, net
|
27,159
|
57,281
|
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Goodwill
|
31,514
|
31,514
|
|
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Right-of-use
lease assets
|
29,704
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18,489
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Deferred
income taxes
|
20,534
|
8,908
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Restricted
cash and other
|
8,356
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6,935
|
|
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|
|
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Total
assets
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$349,451
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$286,932
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current liabilities:
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Accounts
payable
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$11,971
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$8,960
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Accrued
liabilities
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45,386
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34,019
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Current
portion of business combination liabilities
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33,608
|
8,718
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Current
maturities of long-term debt
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10,790
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3,369
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|
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Total
current liabilities
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101,755
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55,066
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Long-term liabilities:
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Business
combination liabilities, net of current portion
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19,087
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43,412
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Long-term
debt, net of current maturities
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13,716
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1,325
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Right-of-use
liabilities, net of current portion:
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Lease
liability
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25,005
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13,686
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Deferred
lease incentive obligation
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16,758
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-
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Deferred
income taxes
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7,457
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9,747
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Other
|
9,205
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9,160
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Total
liabilities
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192,983
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132,396
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Stockholders’ equity:
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Common
Stock; $0.001 par value. Authorized 100,000 shares; issued and
outstanding
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75,393 and 75,067
shares as of March 31, 2019 and
December 31, 2018, respectively
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75
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75
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Additional
paid-in capital
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179,592
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176,471
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Accumulated
other comprehensive loss
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1,053
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626
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Accumulated
deficit
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(24,252)
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(22,636)
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Total
stockholders' equity
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156,468
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154,536
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Total
liabilities and stockholders' equity
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$349,451
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$286,932
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NEW AGE BEVERAGES CORPORATION
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Unaudited Condensed Consolidated Statements of
Operations
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Three Months Ended March 31, 2019 and 2018
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(In thousands, except net loss per share amounts)
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2019
|
2018
|
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Net
revenue
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$58,307
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$11,558
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Cost
of goods sold
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19,731
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8,942
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Gross
profit
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38,576
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2,616
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Operating
expenses:
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Commissions
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18,038
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327
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Selling,
general and administrative
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26,842
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4,256
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Change
in fair value of Marley earnout obligation
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-
|
100
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Depreciation
and amortization expense
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2,236
|
521
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Total
operating expenses
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47,116
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5,204
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Operating
loss
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(8,540)
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(2,588)
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Non-operating
income (expenses):
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Gain
from sale of land and building
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6,442
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-
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Interest
expense
|
(1,646)
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(56)
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Other
debt financing expenses
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(224)
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-
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Gain
from change in fair value of embedded derivatives
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470
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-
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Other income
(expense), net
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182
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(7)
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Loss
before income taxes
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(3,316)
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(2,651)
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Income
tax benefit
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1,700
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-
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Net loss
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$(1,616)
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$(2,651)
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Net
loss per share attributable to common stockholders (basic and
diluted)
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$(0.02)
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$(0.07)
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Weighted
average number of shares of Common Stock outstanding (basic and
diluted)
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75,226
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36,197
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Non-GAAP Financial Measures
The
primary purpose of using non-GAAP financial measures is to provide
supplemental information that the Company believes may prove useful
to investors and to enable investors to evaluate the
Company’s results in the same way as management. The Company
also presents the non-GAAP financial measures because it believes
they assist investors in comparing the Company’s performance
across reporting periods on a consistent basis, as well as
comparing the Company’s results against the results of other
companies, by excluding items that the Company does not believe are
indicative of its core operating performance. Specifically, the
Company uses these non-GAAP measures as measures of operating
performance; to prepare the annual operating budget; to allocate
resources to enhance the financial performance of the
Company’s business; to evaluate the effectiveness of the
Company’s business strategies; to provide consistency and
comparability with past financial performance; to facilitate a
comparison of the Company’s results with those of other
companies, many of which use similar non-GAAP financial measures to
supplement their GAAP results; and in communications with the
Company’s board of directors concerning financial
performance. Investors should be aware however, that not all
companies define these non-GAAP measures consistently. The Company
discloses the following non-GAAP financial measures:
Non-GAAP Gross Revenue. For the calculation of Non-GAAP
gross revenue, the Company excludes selling discounts and
allowances when evaluating the gross amount of its revenue. Gross
revenue is an important metric because this is how the Company
believes investors and competitors compare financial results of
beverage companies since with additional scale distributors and
retailers will have less ability to force discounts and allowances
on smaller companies in the market, which will help identify the
full value to an investor, competitor or potential
acquirer.
EBITDA is net loss adjusted to exclude interest
expense, income tax expense, and depreciation and amortization
expense.
Adjusted EBITDA. For the calculation of Adjusted EBITDA, the
Company also excludes the following items for the periods
presented:
Stock-Based Compensation Expense: The Company’s
compensation strategy includes the use of stock-based compensation
to attract and retain employees, directors and consultants. This
strategy is principally aimed at aligning the employee interests
with those of the Company’s stockholders and to achieve
long-term employee retention, rather than to motivate or reward
operational performance for any particular period. As a result,
stock-based compensation expense varies for reasons that are
generally unrelated to operational decisions and performance in any
particular period.
Gain from the Sale of Long-lived Assets: Gains from the sale
of land, buildings and other long-lived assets are excluded since
they do not relate core business activities.
Other Debt Financing Expenses: Other debt financing expenses
include collateral monitoring, unused line fees and other expenses
related to the Company’s credit agreements. Since these
amounts related to the Company’s debt financing structure,
they are excluded since they do not relate to core business
activities.
Gain on Change in Fair Value of Embedded Derivatives: The
Company’s former Siena Revolver credit facility included
features that were determined to be embedded derivatives requiring
bifurcation and accounting as separate financial instruments. The
Company has excluded gains and losses related to the changes in
fair value of embedded derivatives given the nature of the fair
value requirements. The Company cannot manage these amounts as part
of its business operations nor are the gains and losses part of its
core business activities, so they have been excluded.
The
tables below provide a reconciliation from the most directly
comparable GAAP financial measure to each non-GAAP financial
measure presented. The calculation of Non-GAAP gross revenue is
presented below for the three months ended March 31, 2019 and 2018
(in thousands):
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2019
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2018
|
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Non-GAAP gross revenue:
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Net
revenue
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$58,307
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$11,558
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Non-GAAP
adjustment:
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Discounts
and allowances, net of recoveries
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2,158
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1,210
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Non-GAAP gross revenue
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$60,465
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$12,768
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The
calculation of non-GAAP EBITDA and Adjusted EBITDA are presented
below for the three months ended March 31, 2019 and 2018 (in
thousands):
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2019
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2018
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Non-GAAP EBITDA and Adjusted EBITDA reconciliation:
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Net
loss
|
$(1,616)
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$(2,651)
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Non-GAAP
adjustments to determine EBITDA:
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Interest
expense
|
1,646
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56
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Income
tax benefit
|
(1,700)
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-
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Depreciation
and amortization expense
|
2,236
|
521
|
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EBITDA
|
566
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(2,074)
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Non-GAAP
adjustments to determine Adjusted EBITDA:
|
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Stock-based
compensation expense
|
3,287
|
377
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Other
debt financing expenses
|
224
|
-
|
|
Gain
from sale of land and building
|
(6,442)
|
-
|
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Gain
from change in fair value of embedded derivatives
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(470)
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-
|
|
|
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Adjusted EBITDA
|
$(2,835)
|
$(1,697)
|