The Vita Coco Company Inc · Q1 2022 earnings

Briefing

Net sales increased, driven by Vita Coco Coconut Water growth, but gross profit decreased due to increased transportation costs.

The Vita Coco Company reported a 28% increase in net sales to $96 million for Q1 2022, driven by strong growth in Vita Coco Coconut Water. However, gross profit decreased due to increased transportation costs, resulting in a net income of $2 million, or $0.04 per diluted share. The company is revising its full-year Adjusted EBITDA guidance due to increased cost pressures but remains confident in achieving its net sales growth guidance of 16-20%.

• Net sales grew 28% to $96 million, driven by a 38% increase in Vita Coco Coconut Water sales.
• Gross profit was $19 million, a decrease from $24 million in the prior year, primarily due to higher transportation costs.
• Net income attributable to shareholders was $2 million, or $0.04 per diluted share, benefiting from a non-cash gain on derivative instruments.
• Adjusted EBITDA was a loss of $3 million, compared to a gain of $6 million in the same period last year.

Headline financials

Revenue & EPS history

The Company expects net sales in the range of $440-455 million, representing growth of approximately 16-20% compared to fiscal year 2021. Anticipate full year gross margins in the mid 20%’s due to the continued expectation of elevated transportation costs, partially offset by the benefit of higher net pricing and accelerated efficiency initiatives. Forecast Adjusted EBITDA in the range of $27-32 million reflecting higher than anticipated transportation costs in the first quarter.