DENVER, COLORADO, Aug. 08, 2019 (GLOBE NEWSWIRE) -- NEW AGE BEVERAGES CORPORATION (NBEV), the Colorado and Utah-based healthy products company, today announced financial results for the second quarter ended June 30, 2019. The Company achieved record sales, with net revenue reaching $66.3 million versus a prior year of $13.4 million, a growth of 397%.



KEY HIGHLIGHTS:

Net revenue reached an all-time high of $66.3 million, up 397% over Q2 2018 and a 14% increase sequentially from Q1 2019.

Gross margins increased to 63% compared to 13% in the prior year quarter.

Achieved positive Adjusted EBITDA compared to a loss of $2.2 million in Q2 2018 and a net loss of $11.7 million during Q2 2019.

Maintained strong Balance Sheet with cash of $83.6 million and positive working capital of $57.8 million

“We are pleased with our second quarter operating results, which again exceeded our guidance in revenue and positive Adjusted EBITDA,” stated Brent Willis, Chief Executive Officer of New Age Beverages. “We finished the quarter strong and believe that we will see good organic growth in the second half of 2019. With the strength of our balance sheet and the improved sales and marketing capabilities that we added with the Brands Within Reach acquisition, we believe we are building excellent momentum for continued improved operating performance in the back half of the year.”

The Company will host a live conference call and webcast today at 8:30 a.m. EST. Conference call details are provided at the end of this press release.

Q2 2019 FINANCIAL RESULTS

For the three-month period ended June 30, 2019, gross revenues reached $68.5 million versus $15.2 million in the prior year. Net revenues less discounts, returns and billbacks reached $66.3 million versus $13.4 million in the prior year, an increase of 397%.

Gross profit in the second quarter reached $41.6 million versus $1.8 million in the prior year. As a percent of net sales, gross margin was up significantly to 63% versus 13% in the prior year, primarily due to product mix and the combination with Morinda, which was completed on December 21, 2018.

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Total operating expenses for the quarter were $44.6 million, down $2.5 million versus the prior quarter, and up versus the prior year due primarily to the increased selling, general and administrative expenses associated with the Morinda merger. Total operating expenses are net of an unrealized gain of $6.7 million from the change in fair value of the Morinda earnout obligation, partially offset by $3.1 million of non-cash expenses and a $1.5 million impairment charge.

Net loss was $11.7 million or $(0.15) per share versus a loss of $3.4 million or $(0.09) per share in the second quarter of 2018. Adjusted EBITDA was positive, in line with guidance and improved to $14,000 compared to $2.2 million loss in the prior year quarter.

New Age’s cash balance as of June 30, 2019 totaled $83.6 million and working capital was $57.8 million as compared to cash at December 31, 2018 of $42.5 million and working capital of $40.9 million. Total assets increased to $331.7 million versus $286.9 million at the end of 2018.

CONFERENCE CALL INFORMATION:

Interested investors can dial into the conference call to hear the details of management's update and participate in a question and answer session.

Date: Thursday, August 8, 2019 Time: 8:30 a.m. Eastern time Toll-free dial-in number: 1-866-221-1749 International dial-in number: 1-270-215-9924 Conference ID: 4882446

The conference call will also be broadcast live and available for replay here and via the investors section of the company’s website at https://newagebev.com/en-us .

Please call the conference telephone number 5-10 minutes prior to the start time. You will be asked to register your name and organization. If you have any difficulty connecting to the conference call, please contact Gateway Investor Relations at 1-949-574-3860.

A replay of the conference call will be available after 11:30 a.m. Eastern time today and continuing through August 15, 2019.

Toll-free replay number: 1-855-859-2056

International replay number: 1-404-537-3406

Replay ID: 4882446

About New Age Beverages Corporation (NASDAQ: NBEV )

New Age Beverages Corporation is a Colorado and Utah-based healthy products company dedicated to educating and inspiring consumers to “live healthy”. The Company is the only omni-channel company with access to traditional retail, e-commerce, direct-to-consumer, and medical channels across 60 countries around the world. New Age is also the only one-stop-shop of healthy beverages and includes the brands Nestea, Illy Coffee, Volvic, Tahitian Noni, TeMana, Búcha Live Kombucha, XingTea, Marley, and others. New Age competes in the growth segments of the >$1 trillion-dollar non-alcoholic beverage industry and has become one of the largest non-alcoholic beverage companies, one of the largest healthy beverage companies, and one of the fastest growing in the world over the past three years.

The Company operates the websites www.newagebev.com , www.morinda.com , www.bwrgroup.com , www.mybucha.com , www.xingtea.com , www.drinkmarley.com , www.nhancedcbd.com , and www.cocolibre.com .

New Age has exclusively partnered with the world's 5th largest water charity, WATERisLIFE, to end the world water crisis with the most innovative technologies available. Donate at WATERisLIFE.com to help us #EnditToday.

Safe Harbor Disclosure

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are any statement reflecting management's current expectations regarding future results of operations, economic performance, financial condition and achievements of the Company including statements regarding New Age Beverages’ expectation to see growth. The forward-looking statements are based on the assumption that operating performance and results will continue in line with historical results. Management believes these assumptions to be reasonable but there is no assurance that they will prove to be accurate such as that we will see good organic growth in the second half of 2019 and that we are building excellent momentum for continued improved operating performance in the back half of the year. Forward-looking statements, specifically those concerning future performance are subject to certain risks and uncertainties, and actual results may differ materially. New Age Beverages competes in a rapidly growing and transforming industry, and other factors disclosed in the Company's filings with the Securities and Exchange Commission might affect the Company’s operations. Unless required by applicable law, New Age undertakes no obligation to update or revise any forward-looking statements.

For investor inquiries about New Age Beverages Corporation please contact:

Media:

Desiree Rosa, MULTIPLY

Tel: 646-499-3306

NewAgeBev@wearemultip.ly

Investor Relations Counsel:

Cody Slach, Gateway Investor Relations

Tel: 949-574-3860

NBEV@gatewayir.com

New Age Beverages Corporation:

Greg Gould

Chief Financial Officer

Tel: 303-566-3030

GGould@NewAgeBev.com





NEW AGE BEVERAGES CORPORATION

Unaudited Condensed Consolidated Balance Sheets

(In thousands, except par value per share amounts)

June 30, December 31, 2019 2018 ASSETS Current assets: Cash and cash equivalents $ 83,580 $ 42,517 Accounts receivable, net of allowance of $80 and $134, respectively 15,177 9,837 Inventories 36,943 37,148 Prepaid expenses and other 10,219 6,473 Total current assets 145,919 95,975 Long-term assets: Identifiable intangible assets, net 66,062 67,830 Property and equipment, net 27,476 57,281 Goodwill 31,514 31,514 Right-of-use lease assets 33,844 18,489 Deferred income taxes 17,494 8,908 Restricted cash and other 9,392 6,935 Total assets $ 331,701 $ 286,932 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 9,282 $ 8,960 Accrued liabilities 53,604 34,019 Current portion of business combination liabilities 14,431 8,718 Current maturities of long-term debt 10,852 3,369 Total current liabilities 88,169 55,066 Long-term liabilities: Business combination liabilities, net of current portion 6,030 43,412 Long-term debt, net of current maturities 13,364 1,325 Right-of-use liabilities, net of current portion: Lease liability 30,557 13,686 Deferred lease incentive obligation 16,538 - Deferred income taxes 9,790 9,747 Other 9,453 9,160 Total liabilities 173,901 132,396 Stockholders’ equity: Common Stock; $0.001 par value. Authorized 200,000 shares; issued and outstanding 77,624 and 75,067 shares as of June 30, 2019 and December 31, 2018, respectively 77 75 Additional paid-in capital 192,034 176,471 Accumulated other comprehensive loss 1,622 626 Accumulated deficit (35,933 ) (22,636 ) Total stockholders' equity 157,800 154,536 Total liabilities and stockholders’ equity $ 331,701 $ 286,932

NEW AGE BEVERAGES CORPORATION

Consolidated Statements of Operations

(In thousands, except loss per share amounts)

Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Net revenue $ 66,348 $ 13,363 $ 124,655 $ 24,921 Cost of goods sold 24,699 11,603 44,430 20,545 Gross profit 41,649 1,760 80,225 4,376 Operating expenses: Commissions 19,607 346 37,645 673 Selling, general and administrative 28,175 4,142 55,017 8,398 Change in fair value of earnout obligations (6,665 ) - (6,665 ) 100 Impairment of right-of-use lease assets 1,500 - 1,500 - Depreciation and amortization expense 2,017 517 4,253 1,038 Total operating expenses 44,634 5,005 91,750 10,209 Operating loss (2,985 ) (3,245 ) (11,525 ) (5,833 ) Non-operating income (expenses): Gain from sale of land and building - - 6,442 - Interest expense (756 ) (125 ) (2,402 ) (181 ) Other debt financing expenses - - (224 ) - Gain from change in fair value of embedded derivatives - - 470 - Interest and other income (expense), net (143 ) 3 39 (4 ) Loss before income taxes (3,884 ) (3,367 ) (7,200 ) (6,018 ) Income tax expense (7,797 ) - (6,097 ) - Net loss $ (11,681 ) $ (3,367 ) $ (13,297 ) $ (6,018 ) Net loss per share attributable to common stockholders (basic and diluted) $ (0.15 ) $ (0.09 ) $ (0.18 ) $ (0.16 ) Weighted average number of shares of Common Stock outstanding (basic and diluted) 76,331 38,911 75,780 37,513

Non-GAAP Financial Measures

The primary purpose of using non-GAAP financial measures is to provide supplemental information that the Company believes may prove useful to investors and to enable investors to evaluate the Company’s results in the same way as management. The Company also presents the non-GAAP financial measures because it believes they assist investors in comparing the Company’s performance across reporting periods on a consistent basis, as well as comparing the Company’s results against the results of other companies, by excluding items that the Company does not believe are indicative of its core operating performance. Specifically, the Company uses these non-GAAP measures as measures of operating performance; to prepare the annual operating budget; to allocate resources to enhance the financial performance of the Company’s business; to evaluate the effectiveness of the Company’s business strategies; to provide consistency and comparability with past financial performance; to facilitate a comparison of the Company’s results with those of other companies, many of which use similar non-GAAP financial measures to supplement their GAAP results; and in communications with the Company’s board of directors concerning financial performance. Investors should be aware however, that not all companies define these non-GAAP measures consistently. The Company discloses the following non-GAAP financial measures:

Non-GAAP Gross Revenue. For the calculation of Non-GAAP gross revenue, the Company excludes selling discounts and allowances when evaluating the gross amount of its revenue. Gross revenue is an important metric because this is how the Company believes investors and competitors compare financial results of beverage companies since with additional scale distributors and retailers will have less ability to force discounts and allowances on smaller companies in the market, which will help identify the full value to an investor, competitor or potential acquirer.

EBITDA is net loss adjusted to exclude interest expense, income tax expense, and depreciation and amortization expense.

Adjusted EBITDA. For the calculation of Adjusted EBITDA, the Company also excludes the following item for the periods presented:

Stock-Based Compensation Expense: The Company’s compensation strategy includes the use of stock-based compensation to attract and retain employees, directors and consultants. This strategy is principally aimed at aligning the employee interests with those of the Company’s stockholders and to achieve long-term employee retention, rather than to motivate or reward operational performance for any particular period. As a result, stock-based compensation expense varies for reasons that are generally unrelated to operational decisions and performance in any particular period.

The tables below provide a reconciliation from the most directly comparable GAAP financial measure to each non-GAAP financial measure presented. The calculation of Non-GAAP gross revenue is presented below for the three and six months ended June 30, 2019 and 2018 (in thousands):

Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Net revenue $ 66,348 $ 13,363 $ 124,655 $ 24,921 Non-GAAP adjustment for discounts and allowances 2,145 1,861 4,303 3,071 Non-GAAP gross revenue $ 68,493 $ 15,224 $ 128,958 $ 27,992

The calculation of non-GAAP EBITDA and Adjusted EBITDA are presented below for the three months ended June 30, 2019 and 2018 (in thousands):

Three Months Ended Six Months Ended June 30, June 30, 2019 2018 2019 2018 Net loss $ (11,681 ) $ (3,367 ) $ (13,297 ) $ (6,018 ) EBITDA Non-GAAP adjustments: Interest expense 756 125 2,402 181 Income tax expense 7,797 - 6,097 - Depreciation and amortization expense 2,111 517 4,441 1,038 EBITDA (1,017 ) (2,725 ) (357 ) (4,799 ) Adjusted EBITDA Non-GAAP adjustment: Stock-based compensation expense 1,031 521 4,318 898 Adjusted EBITDA $ 14 $ (2,204 ) $ 3,961 $ (3,901 )

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