Reed's, Inc., maker of the top-selling sodas in natural food stores nationwide, today announced the financial results for its first fiscal quarter ending March 31, 2012.
Revenues increased 27 percent to $6.5 million in 2012, compared to 2011.
Gross profit increased to $2.0 million, an increase of 40 percent from 2011. The gross profit percentage increased to 30 percent of sales, an increase from 28 percent in 2011.
Earnings before non-cash items and finance costs (modified EBITDA) increased to $268,000 during 2011, as compared to $31,000 in the prior year period.
Net loss for 2012 was $124,000, or $0.01 per share, compared to a loss of $365,000 a year earlier.
Working capital at March 31, 2012 was $2.6 million, as compared to $2.7 million at Dec. 31, 2011.
The company also announced that the credit limit on their revolving line of credit has been increased from $3 million to $4 million, effective May 11, 2012.
Operational highlights include:
- Expanded distribution into Michigan and Tennessee markets.
- Entered into an enhanced distribution partnership with largest distributor, UNFI.
- Gained entry into Spartan stores (estimated 70 to start) based out of Grand Rapids, Mich.
- Gained new distribution into TJX Stores (Home Goods Division - est 290+ stores).
- DECA Military approves authorization of Reed's/Virgil's skus to be sold in commissaries across the US. product to be sold in by Reed's current DSD network.
- Continued upgrading Los Angeles plant to increase capacity and efficiency.
"This is our 10th quarter in a row of double-digit growth," said Chris Reed, founder, chairman and CEO of Reed's, Inc. in a prepared statement. "We are pleased with the continued, strong, top-line revenue growth on our brands and private label. We are also excited by the results of our margin improvement program started in the fourth quarter of 2011. Significant increases in both revenues and gross profit margins are pushing us quickly to profitability."
James Linesch, chief financial officer, stated, "Our overall working capital is sufficient for our current business expansion and is anticipated to increase through cash positive operations. Our drop in cash to $101,000 at March 31, 2012, with an additional $213,000 available, is largely due to a buildup of certain inventory items and a short term increase in our receivables. We are focusing on inventory reductions by planning our productions closer to our sales. We have reduced our inventory levels by more than $500,000 since quarter-end, and we anticipate further reductions in the months ahead. Along with an increased limit on our revolving line of credit, we believe that we will not require additional capital to carry out our current business plans for 2012."
For information, go to: http://www.reedsinc.com/investor-relations/