BOCA RATON. Fla., Feb. 27, 2013 (GLOBE NEWSWIRE) -- Celsius Holdings, Inc., (Other OTC:CELH), the creator and marketer of Celsius®, the world's first calorie burning drink backed by clinical science, today reported its results of operations for the fourth quarter ended December 31, 2012.
Fourth Quarter 2012 Financial Highlights:
Revenue: Net revenues for the three months ended December 31, 2012 totaled $1.93 million as compared to $1.76 million for the same period in 2011, a 10% increase. A significant portion of this increase is attributable to increases in international sales $988,000 and domestic accounts, off-set by a 2010 return reserve adjustment realized in 2011 which amounted to ($242,000) and reductions in warehouse clubs sales ($608,000).
Gross Profit: Gross profits for the fourth quarter totaled $634,000 or 33% of net sales as compared to $766,000 or 43% for the same period in 2011. When excluding the 2010 reserve adjustment realized in 2011 ($242,000), Non-GAAP gross profit margins decreased to 33% from 34% during same period in the prior year. The Company continues to focus on cost savings initiatives and efficiencies to improve gross profit margins.
Operating Expenses: Operating Expenses for the three months ended December 31, 2012 totaled $868,000 as compared to $1.42 million for the same period in 2011, a 39% decrease. A significant portion of this decrease is attributable to decreases in severance, option expense, legal, and professional fees.
Net Loss: The Company recorded a net loss of $329,000 for the fourth quarter compared to a net loss of $716,000 for the same quarter a year ago, or ($0.02) and ($0.04) per share, respectively. The decrease in net loss is attributable to reductions in severance, option expense, legal, professional fees, off-set decrease in gross profits and continued investments in marketing programs.
Full Year 2012 Financial Highlights:
Revenue: Net revenues for 2012 totaled $7.68 million as compared to $8.54 million in 2011, a 10% decrease. A significant portion of this decrease is attributable to decreases in warehouse club sales $1.19 million, 2010 return reserve adjustment realized in 2011 which amounted to $498,000, and reductions of domestic account revenues $385,000 mainly associated with eliminating unprofitable and underperforming accounts, off-set by increases of international sales $1.21 million.
Gross Profit: Gross profits for 2012 totaled $2.31 million or 30% of net sales as compared to $3.33 million or 39% for 2011. When excluding the 2010 reserve adjustment realized in 2011 ($498,000), Non-GAAP gross profit margins decreased to 30% from 35% in the prior year. A significant portion of this decrease is attributable to increases in lower margin international sales. International margins were reduced to provide further support for expansion into retail distribution channels. The Company continues to focus on cost savings initiatives and efficiencies to improve gross profit margins.
Operating Expenses: Operating Expenses for 2012 totaled $4.74 million as compared to $4.99 million for 2011, a 5% decrease. A significant portion of this decrease is attributable to decreases in severance, option expense, legal, and professional fees, offset by increases in marketing programs and investments in human resources.
Net Loss: The Company recorded a net loss of $2.75 million for 2012 compared to a loss of $1.91 million a year ago, or ($0.14) and ($0.10) per share, respectively.
The Company also announced a completed amendment of its line of credit with CDS Ventures of South Florida, LLC, which increased the line by $2,175,000 to $7,450,000 (of which $5.95 million was outstanding as of December 31, 2012). The Line of Credit is available to the Company, as necessary, to fund working capital needs associated with Celsius' expansion, as well as general corporate purposes.
Celsius continues to expand both domestically and internationally both in channel distribution points and revenue.
During Q4 Celsius implemented several key initiatives domestically that will provide a basis for growth:
- Increased distribution domestically by over 2,000 store fronts.
- Singles strategy was implemented by most of our distribution partners, providing a greater opportunity for consumer trial and effective single-unit in-store promotions.
- Transformed the Celsius Ambassador program into a quantifiable revenue generating program.
- Expanded our DSD distribution in key markets providing a robust hybrid distribution model.
- Launched a new state of the art website that combines key software components, which provides superior engagement with our consumer, better analytical tools and an improved online store.
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Celsius international business continued to grow both in revenue and distribution channels. Celsius continues with the product registration process in several key countries.
"2012 was a year of change for Celsius," Gerry David, President and CEO said. During 2012 we:
- Implemented new software systems
- Moved our manufacturing and warehousing in an effort to reduce costs
- Launched new brand design
- Successfully implemented the "Drill Deep" model in five key regions
- Launched a new online destination for customers and business partners that presents the brand with a fresh and modern look, improved functionality and new features to engage, entertain and enlighten our audience.
- Implemented new "singles" strategy with aggressive in-store promotion calendar
- Executed 14.5% price increase across all channels, effective January 1st 2013
- Qualified a new European production facility
- 5W Public Relations secured strategic media placements driving 2013 momentum and brand awareness.
"Celsius is positioned for growth on a global basis in 2013," David said. "Celsius continues to separate itself from the energy drink market by re-enforcing its functionality and science."
About Celsius Holdings, Inc.
Celsius Holdings, Inc. (Other OTC:CELH) markets Celsius®, which is backed by science. Celsius is dedicated to providing healthier, everyday refreshment through science and innovation. For more information, please visit www.celsius.com.
The Celsius Holdings logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=15323
Forward-Looking Statements
This press release may contain statements that are not historical facts and are considered forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements contain projections of Celsius Holdings' future results of operations and/or financial position, or state other forward-looking information. In some cases you can identify these statements by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," "would," or similar words. You should not rely on forward-looking statements since Celsius Holdings' actual results may differ materially from those indicated by forward-looking statements as a result of a number of important factors. These factors include, but are not limited to: general economic and business conditions; our business strategy for expanding our presence in our industry; anticipated trends in our financial condition and results of operation; the impact of competition and technology change; existing and future regulations affecting our business; and other risks and uncertainties discussed in the reports Celsius Holdings has filed previously with the Securities and Exchange Commission. Celsius Holdings does not intend to and undertakes no duty to update the information contained in this press release.
| Celsius Holdings, Inc. and Subsidiaries | ||
| Condensed Consolidated Balance Sheets | ||
| (Unaudited) | ||
| December 31 | December 31 | |
| ASSETS | 2012 | 2011 |
| Current assets: | ||
| Cash and cash equivalents | $ 108,981 | $ 130,536 |
| Accounts receivable, net | 620,325 | 537,867 |
| Inventories, net | 921,709 | 871,779 |
| Other current assets | 295,314 | 69,340 |
| Total current assets | 1,946,329 | 1,609,522 |
| Property, fixtures and equipment, net | 104,690 | 67,000 |
| Total Assets | $ 2,051,019 | $ 1,676,522 |
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||
| Current liabilities: | ||
| Accounts payable and accrued expenses | $ 861,640 | $ 865,914 |
| Short-term liabilities – other | 173,557 | 1,989 |
| Total current liabilities | 1,035,197 | 867,903 |
| Long-term liabilities – other | 0 | 114,000 |
| Convertible note payable, related party | 1,500,000 | 1,500,000 |
| Note due to related parties | 5,950,000 | 3,000,000 |
| Total Liabilities | 8,485,197 | 5,481,903 |
| Stockholders' Equity (Deficit): | ||
| Common stock | 20,179 | 20,182 |
| Additional paid-in capital | 36,843,414 | 36,722,893 |
| Accumulated deficit | (43,297,771) | (40,548,456) |
| Total Stockholders' Equity (Deficit) | (6,434,178) | (3,805,381) |
| Total Liabilities and Stockholders' Equity (Deficit) | $ 2,051,019 | $ 1,676,522 |
| Celsius Holdings, Inc. and Subsidiaries | ||||
| Condensed Consolidated Statements of Operations | ||||
| (unaudited) | ||||
| For the Three Months | For the Twelve Months | |||
| Ended December 31, | Ended December 31, | |||
| 2012 | 2011 | 2012 | 2011 | |
| Net revenue | $ 1,933,225 | $ 1,762,020 | $ 7,684,005 | $ 8,535,603 |
| Cost of revenue | 1,299,016 | 995,567 | 5,371,123 | 5,207,088 |
| Gross profit | 634,209 | 766,453 | 2,312,882 | 3,328,515 |
| Selling and marketing expenses | 634,094 | 653,952 | 3,033,836 | 2,890,841 |
| General and administrative expenses | 234,335 | 769,925 | 1,708,246 | 2,100,092 |
| Total operating expense | 868,429 | 1,423,877 | 4,742,082 | 4,990,933 |
| Loss from operations | (234,220) | (657,424) | (2,429,200) | (1,662,418) |
| Interest expense, net | (94,519) | (58,710) | (318,115) | (247,239) |
| Net loss | $ (328,739) | $ (716,134) | $ (2,747,315) | $ (1,909,657) |
| Basic and diluted: | ||||
| Weighted average shares outstanding | 20,182,102 | 20,181,408 | 20,182,207 | 18,934,832 |
| Loss per share | $ (0.02) | $ (0.04) | $ (0.14) | $ (0.10) |