CORONA, CALIF. — Innovation and ongoing expansion into international markets helped Monster Beverage Corp. deliver growth in the second quarter.
Net income in the three months ended June 30 was $292,473,000, equal to 53c per share on the common stock, up 8% from $270,116,000, or 48c per share, in the same period last year. Net sales of $1,104,045,000 were up 8.7% from $1,015,873,000. Top-line growth was negatively impacted by unfavorable currency, which cut net sales by $30.7 million. Without those foreign currency movements, net sales for the quarter would have been up 11.2%, according to the company.
Rodney Cyril Sacks, chairman and chief executive officer at Monster, said improved year-over-year sales largely were driven by the Monster Energy brand’s strong domestic and international growth. Net sales for the segment increased 9.6% in the second quarter, rising to $1.2 billion from $929 million.
Through its partnership with Coca-Cola Co. bottlers, the company rolled out several Monster Energy line extensions, including Monster Mango Loco, Monster Pacific Punch and Monster Pipeline Punch, in several new countries and expanded its Espresso Line in Europe.
Mr. Sacks also attributed improved sales to the Reign Total Body Fuel high-performance energy drink line, which launched in the first quarter under the Monster Energy Drinks segment.
“The performance category has had an impact on the overall energy category, and Reign has continued to perform up to our expectations,” he said. “There are a number of other performance energy drinks, like Bang, and some other performance energy drinks that are seeking to obtain listings in space in the convenience channel, such as Celsius and C4 and others. We think that there will ultimately be an additional space allocated to the performance energy drinks.”
The company also launched its new affordable energy brand, Predator, in several international markets under its Strategic Brands segment. Net sales for the segment, which also includes energy drink brands acquired from The Coca-Cola Co., were down 0.8% to $79.1 million for the second quarter, which compared with $79.8 million in the same period last year. Net sales for the Other segment, which includes products sold by American Fruits & Flavors to independent third parties, fell 12.1% to $5.8 million.
Mr. Sacks said Monster plans to continue introducing its Monster Energy Drinks, Reign, and Predator brands and line extensions in new markets. The company also will launch several new products in the United States later this year, including Monster Mule, three new Reign flavors, two new Monster Maxx flavors and a new Java Monster line expansion.