SEATTLE — Jones Soda Co. sustained a loss of $469,000 in the first quarter ended March 31, which compared with a loss of $197,000 in the same period a year ago. Sales fell 20% to $2,837,000 from $3,535,000.
“The first-quarter sales decline was mostly impacted by the final full quarter comparison to last year’s midyear delisting of our 12-oz cans by a major retailer as well as strong pipeline fill following our late 2016 glass bottles launch at 7-Eleven U.S.A.,” Jennifer L. Cue, president and chief executive officer, said during a May 3 conference call with analysts. “Masked in our consolidated sales results was continued strong performance in our important fountain and Lemoncocco initiatives, which grew 123% and 15%, respectively, in the first quarter. The close of convertible subordinate promissory note financing in March bringing in $2.8 million in proceeds that we expect to use among other things, to bolster our sales organization. After the initial closing in March, five additional accredited investors, three of which were company officers, invested an additional $120,000 in the financing during April, bringing in total proceeds of $2.92 million.”
Ms. Cue said the capital infusion is more than just money for Jones Soda; “it signifies an important strategic shift” for the company.
“For the first time in a long time it allows us to proactively accelerate our fountain and Lemoncocco initiatives and capitalize on the promise shown by this product portfolio,” she said.
Asked by an analyst to describe why 2018 is expected to be a significant step forward for the company, Ms. Cue responded: “We’re in the process right now of hiring additional sales force and investing in these initiatives. And we’re in the process of also looking at a number of retail chains and then testing on some of those. So, we believe that this buildup in the investment of sales and marketing as well as some existing business that we are testing, will begin to grow — we’ll start to see the benefits of this in 2018, and see a much more significant growth in the following year as well.”