The Vita Coco Company, Inc. · NASDAQ:COCO
The Vita Coco — Q2 2023 Earnings Presentation
19 slides from The Vita Coco's earnings presentation, Aug 2, 2023
Slide 1: Building the Better Beverage Platform of the Future
BUILDING THE BETTER BEVERAGE PLATFORM OF THE FUTURE 2023 SECOND QUARTER RESULTS
Slide 2: Disclaimer
DISCLAIMER Non-GAAP Financial Measures In addition to disclosing results determined in accordance with U.S. GAAP, The Vita Coco Company, Inc. (the “Company”) also discloses certain non-GAAP results of operations, including, but not limited to, Adjusted EBITDA, that include certain adjustments or exc
Slide 3: 2023 Second Quarter Performance Highlights
2023 SECOND QUARTER PERFORMANCE HIGHLIGHTS NET SALES % GROWTH VS. PRIOR YEAR (PY) NET SALES: $140MM / +21% vs. PY • Q2 2023 Net Sales growth of +21% Americas International driven by strong Vita Coco Coconut Water (VCCW) growth of +23% vs. GROSS PROFIT: Q2 2022, with +19% VCCW Volume $51MM / 37% marg
Slide 4: Our Vision
OUR VISION To be the leading platform for brands in the functional beverage category, and help our consumers… EAT A LITTLE BETTER, DRINK A LITTLE BETTER, LIVE A LITTLE BETTER We believe in democratizing health and wellness, while using business as a force for good to drive positive impact in our com
Slide 5: Building the Better Beverage Platform of the Future
BUILDING THE BETTER BEVERAGE PLATFORM OF THE FUTURE A PUBLIC BENEFIT CORPORATION GLOBAL SUPPLY CHAIN – COCONUT COMMITTED TO GIVING BACK WATER AT SOURCE – SUPPORTED RESPONSIBLE DIFFERENTIATED BY CO-PACK IN MARKET BUSINESS, ASSET-LITE CULTURE & VALUES SUPPLY CHAIN OMNICHANNEL BUSINESS WITH BLUE- PROVE
Slide 6: Investing to Expand Occasions in >$30B Better-For-You Functional Hydration Category
INVESTING TO EXPAND OCCASIONS FOR OUR BRANDS IN >$30B BETTER-FOR-YOU FUNCTIONAL HYDRATION CATEGORY Large Better-For-You Functional Capturing Opportunities Hydration Category Expand the core by increasing Sports Drinks consumption occasions of Coconut $11B Water and gaining share from retail executio
Slide 7: Vita Coco and Coconut Water Outpacing Other Beverage Categories
VITA COCO AND COCONUT WATER OUTPACING OTHER BEVERAGE CATEGORIES; STRONG VOLUME GROWTH, LESS DEPENDENT ON PRICING VS OTHER CATEGORIES VOLUME (OZ) SOLD: TOTAL US MULO+C % CHANGE VS PY DOLLAR $: TOTAL US MULO+C % CHANGE VS PY YTD THROUGH 7/2/23 YTD THROUGH 7/2/23 5.4% 5.4% 9.2% 18.3% 18.1% 9.5% 13.2% 1
Slide 8: Vita Coco Coconut Water Strong Growth in Q2 2023
VITA COCO COCONUT WATER STRONG GROWTH IN Q2 2023, GROWING FASTER THAN CATEGORY; FOUR YEAR GROWTH REMAINS VERY STRONG IN Q2 2023, VITA COCO +17.7% AND GROWING LONG-TERM TRENDS REMAIN STRONG SHARE TO 52% TOTAL US MULO+C $ % CHANGE VS PY TOTAL US MULO+C $ % CHANGE VS 4 YR AGO L52W, L26W, AND L13W THROU
Slide 9: Q2 2023 Growth Across All Circana Channels Driven by Velocity & Distribution
Q2 2023 GROWTH ACROSS ALL CIRCANA REPORTED CHANNELS DRIVEN BY GAINS IN VELOCITY & DISTRIBUTION VITA COCO COCONUT WATER $ % CHANGE VS PY THROUGH 7/2/2023 Q2 ’23 VELOCITY GROWTH +17% +16% +17% +16% Q2 ’23 DISTRIBUTION +19% +17% +20% +6% GROWTH 9 Source: Custom Research by The Vita Coco Company, Vita C
Slide 10: Key 2023 Vita Coco Commercial Drivers Fueling Incremental Growth
KEY 2023 VITA COCO COMMERCIAL DRIVERS ARE FUELING INCREMENTAL $ GROWTH WHILE BASE SKUS REMAIN STRONG; ACV OPPORTUNITIES REMAIN ACV Performance Total US – MULO ACV 1L – $1.7 Q2 ’22 Q2 ‘23 500mL – $1.7 500mL 1ct Base 82 82 330mL – $5.3 500mL MPs 64 66 330mL MPs 11 52 1L MPs 19 44 Farmers 1L 18 46 Tota
Slide 11: Second Quarter 2023 Financial Highlights
SECOND QUARTER 2023 FINANCIAL HIGHLIGHTS Growth Growth % vs. % vs. Prior Year Prior Period Q2 2023 Year Versus Q2 2022: Period Volume (CE) Growth of +17% Net Sales Growth of +21% Gross Margin Gross Margin improvement of 1119bps Adj. EBITDA* increase of $17MM 11 *For all non-GAAP information througho
Slide 12: Gross Margin Recovering - On Pathway to Historical Levels
GROSS MARGIN RECOVERING - ON PATHWAY TO HISTORICAL LEVELS PRIOR PERIODS Q2 YTD Volume (CE) 36MM 43MM 47MM 13MM 15MM 24MM 27MM Q2 2023 Versus Q2 2022: $32MM Impact* Gross Margin % increase driven $67MM largely by improvements in Impact* transportation costs, as well as 2022 brand pricing increases Gr
Slide 13: Updated 2023 Full Year Guidance
UPDATED 2023 FULL YEAR GUIDANCE KEY HIGHLIGHTS NET • Net Sales guidance reflects mid-teens growth for VCCW SALES +10-12% and Private Label Net Sales slightly positive GROWTH1 • Gross Margin anticipated to increase slightly through balance of year, benefiting from the easing of transportation costs a
Slide 14: Long-Term Growth Algorithm
LONG-TERM GROWTH ALGORITHM LONG-TERM TARGET RANGE1 KEY INVESTMENT THEMES o Established beverage platform with strong balance sheet, built for long term growth BRANDED MID o Branded Net Sales2 growth primarily driven NET SALES2 TEENS by Vita Coco Coconut Water including GROWTH contributions from inno
Slide 15: Appendix
APPENDIX 15
Slide 16: Q2 2023 P&L Summary
Q2 2023 P&L SUMMARY $ & CE UNITS IN MM Q2 2023 Q2 2022 VS. PY VOLUME (CE) 15.3 13.0 17% 2.3 NET SALES 139.6 115.3 21% 24.3 GROSS PROFIT / % MARGIN 51.1 / 36.6% 29.3 / 25.4% 74% 21.8 SG&A 30.2 24.3 24% 5.9 INCOME FROM OPERATIONS 20.8 5.0 316% 15.8 NET INCOME / % MARGIN 18.0 /12.9% 1.1 / 1.0% 1479% 16
Slide 17: YTD 2023 P&L Summary
YTD 2023 P&L SUMMARY $ & CE UNITS IN MM YTD 2023 YTD 2022 VS. PY VOLUME (CE) 27.2 24.0 13% 3.2 NET SALES 249.4 211.8 18% 37.6 GROSS PROFIT / % MARGIN 84.8 / 34.0% 48.4 / 22.8% 75% 36.4 SG&A 57.2 49.1 17% 8.1 INCOME FROM OPERATIONS 27.5 (0.7) 4029% 28.2 NET INCOME / % MARGIN 24.7 / 9.9% 3.4 / 1.6% 63
Slide 18: Q2 2023 Net Income to Adjusted EBITDA Reconciliation
Q2 2023 NET INCOME TO ADJUSTED EBITDA RECONCILIATION Three Months Ended June 30, $MM 2023 2022 NET INCOME $18.0 $1.1 Depreciation & Amortization 0.2 0.5 Interest Income (0.3) — Interest Expense — 0.1 Income Tax Expense 4.3 0.6 EBITDA 22.2 2.2 Stock-Based Compensation 2.1 1.8 Unrealized (Gain) / Loss
Slide 19: YTD 2023 Net Income to Adjusted EBITDA Reconciliation
YTD 2023 NET INCOME TO ADJUSTED EBITDA RECONCILIATION Six Months Ended June 30, $MM 2023 2022 NET INCOME $24.7 $3.4 Depreciation & Amortization 0.3 0.9 Interest Income (0.3) — Interest Expense — 0.1 Income Tax Expense 6.1 1.2 EBITDA 30.9 5.6 Stock-Based Compensation 4.3 4.2 Unrealized (Gain) / Loss
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