Celsius Holdings Files Q3 2024 10-Q

TL;DR

CELH Q3 10-Q filed. Latest financials out.

AI Summary

Celsius Holdings, Inc. filed its 10-Q for the period ending September 30, 2024. The filing covers the third quarter and the first nine months of the fiscal year. Key financial data and operational details for this period are presented, including comparative figures from the previous year.

Why It Matters

This filing provides investors with the latest financial performance and operational status of Celsius Holdings, Inc., crucial for understanding the company's trajectory in the competitive beverage market.

Risk Assessment

Risk Level: medium — As a publicly traded company, Celsius Holdings, Inc. is subject to market fluctuations, competition, and regulatory changes inherent in the beverage industry.

Key Numbers

• 91 — Public Document Count (Indicates the volume of documents associated with this filing.)
• 2024-09-30 — Reporting Period End Date (Specifies the end of the fiscal quarter covered by the report.)

Key Players & Entities

• Celsius Holdings, Inc. (company) — Filer of the 10-Q
• 2024-09-30 (date) — End of the reporting period
• 2024-11-06 (date) — Filing date
• BOCA RATON, FL (location) — Company headquarters

FAQ

Key Financial Figures

• $0.001 — nge on which registered Common Stock, $0.001 par value CELH Nasdaq Capital Market

Filing Documents

• celh-20240930.htm (10-Q) — 1232KB
• celh-20240930xexx311.htm (EX-31.1) — 10KB
• celh-20240930xexx312.htm (EX-31.2) — 10KB
• celh-20240930xexx321.htm (EX-32.1) — 5KB
• celh-20240930xexx322.htm (EX-32.2) — 5KB
• celh-20240930_g1.jpg (GRAPHIC) — 34KB
• 0001341766-24-000093.txt ( ) — 7712KB
• celh-20240930.xsd (EX-101.SCH) — 57KB
• celh-20240930_cal.xml (EX-101.CAL) — 89KB
• celh-20240930_def.xml (EX-101.DEF) — 213KB
• celh-20240930_lab.xml (EX-101.LAB) — 704KB
• celh-20240930_pre.xml (EX-101.PRE) — 498KB
• celh-20240930_htm.xml (XML) — 1076KB

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION 2 Item 1.

Financial Statements

Financial Statements 2 Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023 (unaudited) 2 Consolidated Statements of Operations and Comprehensive Income for the three and nine months ended September 30, 2024 and 2023 (unaudited) 3 Consolidated Statements of Changes in Stockholders' Equity and Mezzanine Equity for the three and nine months ended September 30, 2024 (unaudited) 4 Consolidated Statements of Changes in Stockholders' Equity and Mezzanine Equity for the three and nine months ended September 30, 2023 (unaudited) 5 Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023 (unaudited) 6

Notes to Consolidated Financial Statements (unaudited)

Notes to Consolidated Financial Statements (unaudited) 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 30 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 35 Item 4.

Controls and Procedures

Controls and Procedures 35

– OTHER INFORMATION

PART II – OTHER INFORMATION 36 Item 1.

Legal Proceedings

Legal Proceedings 36 Item 1A.

Risk Factors

Risk Factors 36 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 37 Item 3. Defaults Upon Senior Securities 37 Item 4. Mine Safety Disclosures 37 Item 5. Other Information 37 Item 6. Exhibits 39

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Celsius Holdings, Inc. Consolidated Balance Sheets (In thousands, except share and per share amounts) (Unaudited) September 30, 2024 December 31, 2023 ASSETS Current assets: Cash and cash equivalents $ 903,748 $ 755,981 Accounts receivable-net [1] 208,774 183,703 Note receivable-current-net 1,025 2,318 Inventories-net 197,572 229,275 Deferred other costs-current [2] 14,124 14,124 Prepaid expenses and other current assets 38,227 19,503 Total current assets 1,363,470 1,204,904 Property and equipment-net 38,370 24,868 Deferred tax assets 24,186 29,518 Right of use assets-operating leases 5,506 1,957 Right of use assets-finance leases 214 208 Deferred other costs-non-current [2] 237,746 248,338 Intangibles-net 11,877 12,139 Goodwill 14,360 14,173 Other long-term assets 8,594 291 Total Assets $ 1,704,323 $ 1,536,396 LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable [3] $ 30,938 $ 42,840 Accrued expenses [4] 73,024 62,120 Income taxes payable 739 50,424 Accrued promotional allowance [5] 158,810 99,787 Lease liability operating-current 1,358 980 Lease liability finance-current 99 59 Deferred revenue-current [2] 9,513 9,513 Other current liabilities 14,979 10,890 Total current liabilities 289,460 276,613 Lease liability operating-non-current 4,193 955 Lease liability finance-non-current 189 193 Deferred tax liabilities 2,275 2,880 Deferred revenue-non-current [2] 160,092 167,227 Total Liabilities 456,209 447,868 Commitments and contingencies (Note 16) Mezzanine Equity [2] : Series A convertible preferred stock, $ 0.001 par value per share, 5 % cumulative dividends; 1,466,666 shares issued and outstanding at each of September 30, 2024 and December 31, 2023, aggregate liquidation preference of $ 550,000 as of both September 30, 2024 and December 31, 2023. 824,488 824,488 Stockholders' Equity: Common stock, $ 0.001 par value per share; 300

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) September 30, 2024 (Tabular dollars in thousands, except per share amounts) 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Business Overview Celsius Holdings, Inc. (the "Company," "Celsius Holdings" or "Celsius") was incorporated under the laws of the State of Nevada on April 26, 2005. Celsius is a growing company in the functional energy drink category in the United States ("U.S.") and internationally. The Company engages in the development, processing, marketing, sale, and distribution of functional energy drinks to a broad range of consumers. Celsius provides differentiated products that offer clinically proven and innovative formulas meant to positively impact the lives of its consumers. The Company's brand has also proven to be attractive to a broad range of customers, including fitness enthusiasts. The Company's flagship asset, CELSIUS, is marketed as a premium lifestyle and energy drink formulated to power active lifestyles. This product line comes in two versions, a 12-ounce ready-to-drink form and an on-the-go powder form. The Company also offers a CELSIUS Essentials line, available in 16-ounce cans. Celsius products are currently offered in major retail channels across the U.S., including conventional grocery, natural, convenience, fitness, mass market, vitamin specialty and e-commerce. Additionally, the Company's products are available in select markets across Canada, Europe, the Middle East, and the Asia-Pacific region. Agreements with PepsiCo Inc. On August 1, 2022, the Company entered into multiple agreements with PepsiCo Inc. ("Pepsi"), including a long-term agreement that resulted in Pepsi becoming the primary distribution supplier for Celsius products in the U.S. (the "Distribution Agreement"). Under this agreement, the Company granted Pepsi a right of first offer in the event the Company intends to manufacture, distribute or sell products in certain additional countries or channels durin

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) September 30, 2024 (Tabular dollars in thousands, except per share amounts) Significant Estimates — The preparation of consolidated financial statements and accompanying disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses, as well as disclosure of contingent assets and liabilities at the date of the financial statements. Although these estimates are based on management's best knowledge of current events and actions that the Company may undertake in the future, actual results may differ from those estimates. Significant estimates include promotional allowances, the allowance for current expected credit losses, allowance for inventory obsolescence and sales returns, the useful lives of property and equipment, impairment of goodwill and intangibles, deferred taxes and related valuation allowance, and the valuation of stock-based compensation. Segment Reporting — Operating segments are defined as components of an enterprise that engage in business activities, maintain discrete financial information, and undergo regular review by the chief operating decision maker (the "CODM"), who is the Chief Executive Officer, to assess performance and allocate resources. Despite the Company's presence in several geographical regions, it operates as a single operating segment. The Company's operations and strategies are centrally designed and executed due to the substantial similarities among the geographical components. The CODM evaluates operating results and allocates resources primarily on a consolidated basis due to the significant economic interdependencies between the Company's geographical operations. As a result, the Company is managed as a single operating segment and has a single reportable segment. Concentrations of Risk — Substantially all of the Company's revenue is derived from the sale o

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) September 30, 2024 (Tabular dollars in thousands, except per share amounts) Accounts Receivable and Current Expected Credit Losses — The Company is exposed to potential credit risks associated with its product sales and related accounts receivable, as it generally does not require collateral from its customers. The Company's expected loss allowance methodology for accounts receivable is determined using historical collection experience, current and expected future economic and market conditions, an assessment of the current status of customers' trade accounts receivables, and where available, an evaluation of the financial condition and credit ratings of larger customers, including credit reports. Customers are pooled based on common risk factors, and the Company reassesses these customer pools on a periodic basis. The allowance for credit losses is based on aging of the accounts receivable balances and estimated credit loss percentages. The Company estimates expected credit losses for its note receivable related to Qifeng Food Technology (Beijing) Co. Ltd ("Qifeng") by assessing credit risk using the probability of default and incorporating forward-looking information. The repayment, which was formalized via a note receivable from Qifeng (the "Note"), must be serviced even if the licensing agreement is canceled or terminated. The Note is denominated in Chinese-Yuan. Additionally, the Company reserves an allowance for the entire portion of this note that is not covered by the value of certain shares of Celsius Holdings, Inc. held in a brokerage account. See Note 7. Note Receivable for more information. Allowance for Expected Credit Losses Balance as of December 31, 2023 $ 3,137 Current period change for expected credit losses 4,244 Balance as of September 30, 2024 $ 7,381 Inventories — Inventories are valued at the lower of cost or net realizable value with costs approximating those determined under t

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View this 10-Q filing on SEC EDGAR