The Vita Coco Company, Inc. · NASDAQ:COCO
The Vita Coco — Q4 2022 Earnings Presentation
21 slides from The Vita Coco's earnings presentation, Mar 8, 2023
Slide 1: Building the Better Beverage Platform of the Future
BUILDING THE BETTER BEVERAGE PLATFORM OF THE FUTURE 2022 FOURTH QUARTER AND FULL YEAR 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: Full Year 2022 Performance Highlights
FULL YEAR 2022 PERFORMANCE HIGHLIGHTS NET SALES % GROWTH VS. PRIOR YEAR (PY) NET SALES: • Full Year Net Sales growth of +13% driven by strong Vita Coco Coconut $428MM / +13% vs. PY Water (VCCW) growth of +18% vs. FY 2021 despite estimated $4MM of lost Americas International sales from out-of-stocks
Slide 4: Building the Better Beverage Platform of the Future
BUILDING THE BETTER BEVERAGE PLATFORM OF THE FUTURE A PUBLIC BENEFIT CORPORATION GLOBAL SUPPLY CHAIN – COCONUT WATER COMMITTED TO GIVING BACK AT SOURCE – SUPPORTED BY CO-PACK IN DIFFERENTIATED MARKET RESPONSIBLE BUSINESS, ASSET-LITE CULTURE & VALUES SUPPLY CHAIN OMNICHANNEL BUSINESS WITH BLUE-CHIP P
Slide 5: Our Vision
OUR VISION To be the leading independent, pure play natural beverage portfolio company, 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 c
Slide 6: Coconut Water
VITA COCO COCONUT WATER ACCELERATING YTD FOLLOWING STRONG 2022 FY PERFORMANCE; THREE YEAR GROWTH RATE ALSO ACCELERATING VITA COCO FINISHED 2022 AT +15%, GROWING SHARE TO 50% AND LONG-TERM TRENDS CONTINUE TO ACCELERATE TOTAL US MULO+C $ % CHANGE VS PY TOTAL US MULO+C $ % CHANGE VS 3 YR AGO L52W, L26W
Slide 7: 2022 Growth Came Across IRI Reported Channels
2022 GROWTH CAME ACROSS IRI REPORTED CHANNELS DRIVEN BY A COMBINATION OF VELOCITY AND DISTRIBUTION GAINS VITA COCO COCONUT WATER $ % CHANGE VS PY L52W, L26W, AND L13W THROUGH 12/25/22 L52W L26W L13W YTD 2023 Ending 12/25/22 Ending 2/26/23 22.3% 20.8% 21.9% 18.8% 14.7% 13.6% 12.1% 10.0% 10.2% 10.3% 8
Slide 8: Vita Coco Household Penetration and Spend Per Trip Continued to Grow
VITA COCO HOUSEHOLD PENETRATION AND SPEND PER TRIP CONTINUED TO GROW YEAR ON YEAR OUR CONSUMER BASE IS GROWING CONSUMERS ARE SPENDING MORE PURCHASE FREQUENCY IS STABLE …+7% MORE HOUSEHOLDS …+9% MORE PER TRIP VITA COCO % HH PENETRATION VITA COCO VITA COCO SPEND PER TRIP PURCHASE FREQUENCY $8.26 11.6%
Slide 9: 2023 Key Commercial Initiatives
2023 KEY COMMERCIAL INITIATIVES CORE PORTFOLIO AMERICAS INNOVATIONS COMMERCIAL MULTIPACK EXPANSION NEW PACK FORMATS STRATEGIC EXECUTION TO DRIVE TO TRADE CONSUMERS AND PRODUCTS TO COLLABORATION WITH DISTRIBUTION AND UP AND GAIN SHARE OF EXPAND OCCASSIONS DIAGEO TO ENTER RTD GAIN SHARE AT RETAIL SHEL
Slide 10: Key Initiatives for 2023 Branded Growth on Track
KEY INITIATIVES FOR 2023 BRANDED GROWTH ON TRACK MULTIPACKS: COCONUT JUICE CANS: ORGANIC: Offers convenience to heavy buyers Bring consumers into brand with a Bring consumers seeking organic bolder, sweeter taste made with pulp offerings into the brand OPPORTUNITY: Multipacks are 34% of OPPORTUNITY:
Slide 11: Investing in Programs and Platforms to Add New Occasions
INVESTING IN PROGRAMS AND PLATFORMS TO ADD NEW OCCASIONS FOR CONSUMERS TO ENJOY OUR BRANDS Leveraging our collaboration with Extending the brand and disrupting Building new platforms in high Diageo to extend the brand into the other plant-based categories with growth categories on premise occasion h
Slide 12: Fourth Quarter and Full Year Financial Highlights
FOURTH QUARTER AND FULL YEAR FINANCIAL HIGHLIGHTS Q4 2021 Q4 2022 FY 2021 FY 2022 FY Volume (CE) 6% Q4 Volume (CE) 13% growth +10% Growth growth +5% Growth $428 NET SALES Gross Margin $ $92 GP$ was flat X and % $87 with higher net $380 negatively sales offset by impacted by lower margin significantl
Slide 13: Cost of Goods $0.10 per CE Higher Than Q4 2021
COST OF GOODS $0.10 PER CE HIGHER THAN Q4 2021, WITH 11% INCREASE IN TRANSPORTATION COSTS OFFSET BY FINISHED GOODS MIX IMPACTS COGS BREAKDOWN ($ USD IN MILLIONS) Q4 2021A Q4 2022A ESTIMATED Q4 YOY TRANSPORTATION FINISHED GOODS RATE IMPACT OF OCEAN FREIGHT & DOMESTIC 40% LOGISTICS: 43% $65 $70 57% 60
Slide 14: FY 2022 Absorbed $31MM vs. 2021 Due to Transportation Costs
FY 2022 ABSORBED $31MM VS. 2021 AND $67MM VS. 2020 DUE TO INCREASES IN TRANSPORTATION COSTS ON A RATE BASIS COGS BREAKDOWN ($ USD IN MILLIONS) 2020A 2021A 2022A ESTIMATED 2022 VS. TRANSPORTATION FINISHED GOODS 2021 RATE IMPACT OF 23% OCEAN FREIGHT & 33% 39% DOMESTIC LOGISTICS: $206 $266 $324 67% 61%
Slide 15: 2023 Full Year Guidance
2023 FULL YEAR GUIDANCE KEY HIGHLIGHTS • Net Sales guidance reflects mid teens growth for NET SALES 9-11%1 VCCW and approximately flat Private Label Net Sales GROWTH • Gross Margin anticipated to improve over first three quarters as transportation rates ease with FY gross margin between 32-34% • SG&
Slide 16: 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 o Net Sales growth primarily driven by Vita NET SALES MID Coco Coconut Water with potential additional upsides from innovation and GROWTH TEE
Slide 17: Appendix
APPENDIX 17
Slide 18: Q4 P&L Summary
Q4 P&L SUMMARY $ & CE UNITS IN MM Q4’22 Q4’21 VS. PY VOLUME (CE) / % gr. 9.9 9.4 5% 0.5 NET SALES / % gr. 92.0 86.6 6% 5.4 GROSS PROFIT / % marg. 22.4 / 24.4% 21.6 / 24.9% 4% 0.8 SG&A 27.3 26.7 2% 0.6 INCOME FROM OPERATIONS (4.8) (5.1) -5% 0.3 NET INCOME / % marg. (2.8) / -3% (3.4) / -4% -19% 0.6 EP
Slide 19: 2022 P&L Summary
2022 P&L SUMMARY $ & CE UNITS IN MM FY 22 FY 21 VS. PY VOLUME (CE) / % gr. 47.2 42.8 10% 4.5 NET SALES / % gr. 427.8 379.5 13% 48.3 GROSS PROFIT / % marg. 103.4 / 24.2% 113.1 / 29.8% -9% (9.8) SG&A 100.3 88.6 13% 11.7 INCOME FROM OPERATIONS 3.1 24.6 -87% (21.5) NET INCOME / % marg. 7.9 / 1.8% 19.0 /
Slide 20: Q4 2022 Net Income to Adjusted EBITDA Reconciliation
Q4 2022 NET INCOME TO ADJUSTED EBITDA RECONCILIATION THREE MONTHS ENDED DEC 31 2022 2021 Net Income ($2.8) ($3.4) Depreciation & Amortization .5 .5 Interest Income / Expense 0 0 Income Tax Expense 0 (1.0) EBITDA ($2.3) ($3.9) Stock-Based Compensation 1.7 1.7 Unrealized (Gain) / Loss on Derivative In
Slide 21: Full Year 2022 Net Income to Adjusted EBITDA Reconciliation
FULL YEAR 2022 NET INCOME TO ADJUSTED EBITDA RECONCILIATION TWELVE MONTHS ENDED DEC 31 2022 2021 Net Income $7.9 $19.0 Depreciation & Amortization 1.9 2.1 Interest Income / Expense .2 .2 Income Tax Expense 3.0 5.2 EBITDA $13.0 $26.5 Stock-Based Compensation 7.4 3.4 Unrealized (Gain) / Loss on Deriva
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