Pulse Beverage Corp. Announces Third Quarter Update

Nov. 29, 2011

The Pulse Beverage Corp., makers of Cabana™ 100 percent Natural Lemonades and the PULSE® brand of "good-for-you" NutriPurpose™ beverages, announced its third quarter results and issued the following corporate update:

  • Pulse's first two production runs of Cabana™ yielded 18,000 cases and will produce the balance of 28,000 cases during December 2011 and early January 2012.
  • Sales began in October and $40,000 of revenue was recorded in the first month of operations.
  • Another 48,000 cases of bottles are arriving in December for production runs in early 2012.
  • Ten distributors are under contract and each have purchased product, including a distributor for all of Canada.
  • Product is on the shelves of retail outlets in the cities of Denver, Vail, Aspen, Albuquerque, El Paso, Reno, Boise and St. Louis with a new city coming online daily. Pulse's sales team has polled retail stores, the feedback is Cabana™ is selling very well with no advertising of any kind.
  • Working capital as of Sept. 30, 2011 is $510,000.

In early 2011, Pulse strategically determined to introduce its Cabana™ 100 percent Natural Lemonade brand in September ahead of the launch of its PULSE® NutriPurpose™ beverages for the following reasons:

  • The lemonade beverage category offered immediate opportunity due to few competitors. The leader in the category has grown at a rate of 51 percent over the previous year.
  • Lemonades are no longer considered a seasonal beverage and no competitor offered 100 percent natural ingredients .
  • Messaging for Cabana™ is straight-forward: Everyone knows what lemonade is
  • Senior management's years of establishing distributor contacts is allowing Pulse to quickly implement a strong distribution network for Cabana™ which will facilitate and expedite PULSE® NutriPurpose™ beverages introduction via an established network.
  • Pulse successfully predicted efficient Cabana™ product penetration attracting a broad demographic without requiring consumer communication.

In early October Pulse attended the National Association of Convenience Stores Show, a very large beverage show with industry executives from around the globe. The Cabana™ lemonades were featured and product acceptance was exceptional. Pulse's presentation center was one of the busiest at the show and consumers clearly preferred the taste and packaging of Cabana™ 100% Natural Lemonades over the competitors.

Pulse intends to launch its Pulse® NutriPurpose™ beverage brand during the first quarter of 2012. Pre-marketing with distributors is underway in conjunction with continued marketing of Cabana™. Pulse aims to position the new beverage lineup as an extension of the successful lemonade introduction through the enthusiastic participation of the newly established and growing distribution network. The NutriPurposed™ "functional" beverage lineup requires increased educational messaging directed at beverage consumers in order to demonstrate the enhanced benefits predicted to drive sales growth. To this end, Pulse's Chief of Product Development and his team are presently reducing calories and aligning the product with hot-fill bottling processes which allows for all-natural ingredients without the use of preservatives.

Pulse is negotiating co-packing contracts in New Orleans, La. to serve the South and Southeastern states and in Pittsburgh, Pennsylvania to serve the Eastern seaboard. Pulse has completed the first distributor contract for the east coast and is negotiating with eleven additional major distributors. Pulse is also responding to international inquiries regarding the distribution of its beverages from the Philippines, Korea, Mexico, Grand Cayman, Brazil, Argentina and the Bahamas.