The following is a summary of the Zevia PBC (ZVIA) Q2 2024 Earnings Call Transcript:
Financial Performance:
Zevia reported Q2 2024 net sales of $40.4 million, just above the top-end of their guidance, with a year-over-year decrease of 4.3%.
The company experienced a net loss of $7 million, an increase from a $5 million net loss last year.
Gross margin for Q2 was reported at 41.9%, down from the previous year, impacted partly by a $1.8 million charge related to excess inventory.The company anticipates gross margins to return to the mid-40s in Q3 with sequential improvements expected in the following quarters.
Business Progress:
Launched new flavors including Creamy Root Beer, Vanilla Cola, and Cran-Raspberry, aiming to drive distribution, volume, and household penetration.
Expanded distribution through regional direct-store delivery (DSD) partners to improve in-store presence and operational efficiency.
Implemented productivity initiatives projected to save $12 million annually, enhancing operational efficiency and funding marketing and promotional activities.
Increased marketing spending in Q2 to boost brand awareness and consumer engagement.
Opportunities:
Zevia is focused on expanding household reach and product distribution across North America, especially with new upcoming retail partnerships and innovations in flavor and packaging.
Increased promotion and strategic marketing investments to drive growth amidst a competitive beverage market.
Leveraging a new direct-store distribution model in the Pacific Northwest to improve market presence and sales in the convenience channel.
Risks:
Encountered SKU distribution setbacks and club distribution issues impacting short-term revenue and visibility.
Reported a loss in net sales influenced by distribution challenges, including rotational losses in clubs and portfolio rationalization focusing on top-performing categories.
More details: Zevia IR
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