August 7, 2008

Hansen Natural Reports Record 2008 Second Quarter and Six Months Financial Results

Second Quarter Net Sales Rise 15.3 Percent to $282.2 Million; Net Income Increases 31.1 Percent to $50.2 Million

CORONA, Calif., Aug 7, 2008 (PrimeNewswire via COMTEX News Network) -- Hansen Natural Corporation (Nasdaq:HANS) today reported record sales and profits for the second quarter and six-months ended June 30, 2008.

Gross sales for the 2008 second quarter increased 15.5 percent to $324.1 million, from $280.6 million a year earlier. Net sales for the second quarter increased 15.3 percent to $282.2 million from $244.8 million a year ago.

Gross profit, as a percentage of net sales, for the 2008 second quarter was 51.8 percent compared with 52.4 percent in the comparable 2007 quarter and increased from 49.4 percent in the first quarter of 2008. The differences in gross profit as a percentage of net sales is primarily due to changes in product mix.

Operating expenses for the 2008 second quarter increased to $68.0 million from $66.8 million in the same quarter last year.

Distribution costs as a percentage of net sales were 5.5 percent for the quarter, compared with 5.4 percent in the same quarter last year.

Selling expenses as a percentage of net sales for the 2008 second quarter were 12.1 percent, compared with 10.6 percent a year ago. Increases in sponsorship expenditures, sampling activities and commissions, as well as costs relating to event and athlete sponsorships in the United Kingdom, contributed to the increase in such expenses over the prior year.

General and administrative expenses for the 2008 second quarter were $18.3 million compared with $27.6 million for the comparable quarter last year. Included in such expenses are costs associated with terminating existing distributors and legal and accounting fees relating to the special investigation of stock option grants, and granting practices and related litigation (see Certain Identified Items below). Stock based compensation (a non-cash item) was $3.7 million in the second quarter of 2008, compared with $2.0 million in the prior-year period.

Operating income for the 2008 second quarter increased 27.3 percent to $78.2 million from $61.4 million a year ago.

Net income for the second quarter of 2008 increased 31.1 percent to $50.2 million, or $0.51 per diluted share, compared with $38.3 million, or $0.39 per diluted share last year.

Net sales for the Company's DSD segment were $258.6 million for the three-months ended June 30, 2008, an increase of approximately $38.1 million, or 17.3 percent higher than net sales of $220.4 million for the three-months ended June 30, 2007. Net sales for the Company's warehouse segment were $23.7 million for the three-months ended June 30, 2008, a decrease of approximately $0.7 million, or 2.7 percent lower than net sales of $24.3 million for the three-months ended June 30, 2007.

Within the DSD segment, sales of Monster(r) and Java Monster(tm) drinks increased 22.3 percent during the 2008 second quarter while sales of Lost(r) Energy(tm), and other energy drinks were lower.

Sales to customers outside the United States were $19.5 million in the 2008 second quarter (including sales of approximately $1.9 million in the United Kingdom), compared with $13.4 million in the comparable quarter last year.

In the six-months ended June 30, 2008 gross sales increased 20.7 percent to $568.1 million from $470.7 million for the comparable period a year earlier. Net sales increased 20.4 percent to $494.4 million from $410.6 million for the comparable period a year earlier. Gross profit as a percentage of net sales was 50.8 percent for the first half of 2008 compared to 52.1 percent for the same period in 2007.

Operating expenses for the six-months ended June 30, 2008, increased to $129.9 million from $120.6 million in the same period last year (see Certain Identified Items below). Operating income increased 29.7 percent to $121.0 million from $93.3 million in the first six months of 2007.

Net income for the first half of 2008 increased 35.1 percent to $79.0 million, or $0.80 per diluted share, compared with $58.5 million, or $0.59 per diluted share, for the same period last year.

Rodney C. Sacks, chairman and chief executive officer, said that the record revenues and profits reflect continued strong sales of Monster Energy(r) and Java Monster(tm) drinks which continued to grow in excess of the category and gain market share.

"We are proud of the continued strong performance of the Monster(r) brand at a time when almost all categories of ready-to-drink beverages in the United States are experiencing weakness. This weakness is most pronounced in convenience store cold drink channels, where the vast majority of energy drinks are sold. We continue to believe that the moderating growth that we have seen in energy drinks appears, in part, to be due to the challenging macro economic environment and the resulting decline in store traffic primarily in the convenience and gas sector especially in Southern California," added Sacks.

In the first six months of 2008 the Company experienced increased costs of certain raw materials principally apple juice concentrate, aluminum cans and sugar which had a greater impact on the warehouse segment than on the DSD segment.

During the three-months ended June 30, 2008 the Company purchased 1.7 million shares of common stock at an average purchase price of $29.46 per share which the Company holds in treasury.

Certain Identified Items

Contributions net of reimbursements totaling ($0.4) million and $6.5 million for the three-months and ($0.4) million and $19.8 million for the six-months, ended June 30, 2008 and 2007, respectively, were recorded by the Company related to Anheuser-Busch distributors for their contributions to offset the costs of terminating prior distributors. Such amounts have been accounted for as deferred revenue, and are being recognized as revenue ratably over the anticipated 20-year life of the respective Anheuser-Busch distribution agreements. Revenue recognized was $0.5 million for the three-months and $1.0 million for the six-months ended June 30, 2008 and 2007, respectively.

In connection with the transition of certain of the Company's distribution arrangements, the Company incurred termination costs amounting to $0.1 million and $8.4 million in the three-months and $0.1 million and $14.7 million in the six-months, ended June 30, 2008 and 2007, respectively, to certain of its prior distributors, who have been replaced by Anheuser-Busch distributors. Such termination costs have been expensed in full and are included in operating expenses for the corresponding periods.

In connection with the Company's special investigation of stock option grants and granting practices, related litigation and other related matters, the Company incurred professional service fees, net of insurance proceeds, of ($0.4) million and $4.2 million for the three-months and ($0.2) million and $10.9 million for the six-months ended June 30, 2008, and 2007 respectively, which have been fully expensed in the respective periods.

The following table summarizes the identified items discussed above for the three and six-months ended June 30, 2008 and 2007:



                            Three-Months Ended      Six-Months Ended
                                 June 30,               June 30,
                             2008       2007        2008       2007
                          ---------- ----------  ---------- ----------
                             (In        (In        (In         (In
 Deferred Revenue:        Thousands) Thousands)  Thousands) Thousands)
  Contributions from, net
   of reimbursements to,
   Anheuser-Busch
   Distributors            $    (412) $   6,497   $    (365) $  19,847

  Recognition of deferred
   revenue                 $     493  $     509   $   1,016  $     936

 Operating Expenses:
  Termination payments to
   prior distributors      $     150  $   8,353   $     150  $  14,700
  Professional service fees
   (net of insurance
   proceeds) associated
   with the review of stock
   option grants and
   granting practices,
   related litigation and
   other related matters   $    (430) $   4,221   $    (200) $  10,905

Auction Rate Securities

At June 30, 2008 the Company held auction rate securities with a face value of $129.8 million ($207.5 million at March 31, 2008). Additional redemptions amounting to $8.9 million were received by the Company during July. The Company determined that a temporary impairment of $5.8 million had occurred at June 30, 2008 and recorded a charge of $3.4 million net of taxes as a component of accumulated other comprehensive loss for the six-months ended June 30, 2008. These securities will continue to accrue interest at their contractual rates until their respective auctions succeed or they are redeemed.

"Based on our ability to access cash and other short term investments and based on our expected operating cash flows, we do not anticipate that the current lack of liquidity of these investments will have a material effect on our liquidity or working capital," Sacks said.

The Company will host an investor conference call on August 7, 2008 at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time). The conference call will be open to all interested investors through a live audio web broadcast via the internet at www.hansens.com and www.opencompany.info. For those who are not able to listen to the live broadcast, the call will be archived for approximately one year on both websites.

Hansen Natural Corporation

Based in Corona, California, Hansen Natural Corporation markets and distributes Hansen's(r) Natural Sodas, sparkling beverages, fruit juice Smoothies, Energy drinks, Energade(r) energy sports drinks, multi-vitamin juice drinks in aseptic packaging, iced teas, apple juice and juice blends, Junior Juice(r) juices, Blue Sky(r) brand beverages, Monster Energy(r) brand energy drinks, Java Monster(tm) brand non-carbonated dairy based coffee drinks, Lost(r) Energy(tm) brand energy drinks, Joker Mad Energy(tm), Unbound(r) Energy and Ace(tm) Energy brand energy drinks, Rumba(tm), Samba and Tango brand energy juices. For more information visit www.hansens.com and www.monsterenergy.com.

Gross sales, although used internally by management as an indicator of operating performance, should not be considered as an alternative to net sales, which is determined in accordance with accounting principles generally accepted in the United States of America ("GAAP"), and should not be used alone as an indicator of operating performance in place of net sales. Additionally, gross sales may not be comparable to similarly titled measures used by other companies as gross sales has been defined by our internal reporting requirements. However, gross sales is used by management to monitor operating performance including sales performance of particular products, salesperson performance, product growth or declines and our overall performance. The use of gross sales allows evaluation of sales performance before the effect of any promotional items, which can mask certain performance issues. Management believes the presentation of gross sales allows a more comprehensive presentation of our operating performance. Gross sales may not be realized in the form of cash receipts as promotional payments and allowances may be deducted from payments received from customers.

Certain statements made in this announcement may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding the expectations of management with respect to revenues and profitability. Management cautions that these statements are qualified by their terms or important factors, many of which are outside of the control of the Company, that could cause actual results and events to differ materially from the statements made herein, including, but not limited to, the following: changes in consumer preferences; changes in demand that are weather related, particularly in areas outside of California; competitive pricing and/or marketing pressures; activities and strategies of competitors; changes in the price and/or availability of raw materials for the Company's products; the availability of production and/or suitable facilities; the marketing efforts of the distributors of the Company's products, most of which distribute products that are competitive with the products of the Company; the introduction of new products, as well as unilateral decisions that may be made by grocery and/or convenience chain stores, specialty chain stores, club stores and other customers to discontinue carrying all or any of the Company's products that they are carrying at any time; and other risks detailed from time to time in the Company's reports filed with the Securities and Exchange Commission. The Company's actual results could differ materially from those contained in the forward-looking statements. The Company assumes no obligation to update any forward-looking statements.



 HANSEN NATURAL CORPORATION AND SUBSIDIARIES
 CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER INFORMATION
 FOR THE THREE- AND SIX-MONTHS ENDED JUNE 30, 2008 AND 2007
 (In Thousands, Except Per Share Amounts) (Unaudited)
 ---------------------------------------------------------------------

                               Three-Months Ended    Six-Months Ended
                                    June 30,             June 30,
                               ------------------   ------------------
                                 2008       2007     2008       2007
                               --------  --------   --------  --------
 Gross sales, net
  of discounts & returns*      $324,134  $280,582   $568,132  $470,651

 Less: Promotional and other
  allowances**                   41,890    35,819     73,710    60,036
                               --------  --------   --------  --------

 Net sales                      282,244   244,763    494,422   410,615

 Cost of sales                  136,031   116,510    243,489   196,726
                               --------  --------   --------  --------

 Gross profit                   146,213   128,253    250,933   213,889
 Gross profit margin as a
  percentage of net sales          51.8%     52.4%      50.8%     52.1%


 Operating expenses (1)          68,023    66,830    129,916   120,557
 Operating expenses as a
  percentage of net sales          24.1%     27.3%      26.3%     29.4%
                               --------  --------   --------  --------

 Operating income                78,190    61,423    121,017    93,332
 Operating income as a
  percentage of net sales          27.7%     25.1%      24.5%     22.7%

 Interest and other income,
  net                             2,769     1,752      6,395     3,278
                               --------  --------   --------  --------

 Income before provision for
  income taxes                   80,959    63,175    127,412    96,610

 Provision for income taxes      30,727    24,864     48,369    38,101
                               --------  --------   --------  --------

 Net income                    $ 50,232  $ 38,311   $ 79,043  $ 58,509
                               ========  ========   ========  ========
 Net income as a percentage of
  net sales                        17.8%     15.7%      16.0%     14.2%

 Net income per common share:
   Basic                          $0.54     $0.43      $0.85     $0.65
   Diluted                        $0.51     $0.39      $0.80     $0.59

 Case sales (in thousands)
  (in 192-ounce case
  equivalents)                   28,716    26,950     50,990    46,345

 Average net sales price per
  case                         $   9.83  $   9.08   $   9.70  $   8.86

 (1) Includes costs associated with terminating existing distributors
     and legal and accounting fees relating to the special investigation
     of stock option grants and granting practices and related litigation,
     net of insurance proceeds.

 * Gross sales, although used internally by management as an indicator
   of operating performance, should not be considered as an alternative
   to net sales, which is determined in accordance with accounting
   principles generally accepted in the United States of America
   ("GAAP"), and should not be used alone as an indicator of operating
   performance in place of net sales. Additionally, gross sales may not
   be comparable to similarly titled measures used by other companies as
   gross sales has been defined by our internal reporting requirements.
   However, gross sales is used by management to monitor operating
   performance including sales performance of particular products,
   salesperson performance, product growth or declines and our overall
   performance. The use of gross sales allows evaluation of sales
   performance before the effect of any promotional items, which can
   mask certain performance issues. Management believes the presentation
   of gross sales allows a more comprehensive presentation of our
   operating performance. Gross sales may not be realized in the form
   of cash receipts as promotional payments and allowances may be
   deducted from payments received from customers.

 ** Although the expenditures described in this line item are
    determined in accordance with GAAP and meet GAAP requirements, the
    disclosure thereof does not conform with GAAP presentation
    requirements. Additionally, the presentation of promotional and other
    allowances may not be comparable to similar items presented by other
    companies. The presentation of promotional and other allowances
    facilitates an evaluation of the impact thereof on the determination
    of net sales and illustrates the spending levels incurred to secure
    such sales. Promotional and other allowances constitute a material
    portion of our marketing activities.


 HANSEN NATURAL CORPORATION AND SUBSIDIARIES
 CONDENSED CONSOLIDATED BALANCE SHEETS
 AS OF JUNE 30, 2008 AND DECEMBER 31, 2007
 (In Thousands, Except Share Amounts) (Unaudited)
 ------------------------------------------------------------------

                                                    June 30,  Dec. 31,
                                                      2008      2007
                                                    --------  --------
                      ASSETS
                      ------
 CURRENT ASSETS:
 Cash and cash equivalents                          $182,953  $ 12,440
 Short-term investments                               22,066    63,125
 Accounts receivable, net                             83,404    81,497
 Inventories                                         123,218    98,140
 Prepaid expenses and other current assets            10,614     3,755
 Deferred income taxes                                11,902    11,192
                                                    --------  --------
  Total current assets                               434,157   270,149

 INVESTMENTS                                         115,181   227,085
 PROPERTY AND EQUIPMENT, net                           9,238     8,567
 DEFERRED INCOME TAXES
                                                      16,399    14,006
 INTANGIBLES, net                                     24,723    24,066
 OTHER ASSETS                                            774       730
                                                    --------  --------
                                                    $600,472  $544,603
                                                    ========  ========

       LIABILITIES AND STOCKHOLDERS' EQUITY
       ------------------------------------
 CURRENT LIABILITIES:
 Accounts payable                                   $ 71,272  $ 56,766
 Accrued liabilities                                  11,791     9,019
 Accrued distributor terminations                      4,052     4,312
 Accrued compensation                                  4,536     5,827
 Current portion of capital leases                       313       663

 Income taxes payable                                 13,298     6,294
                                                    --------  --------
  Total current liabilities                          105,262    82,881

 DEFERRED REVENUE                                     38,174    39,555

 COMMITMENTS AND CONTINGENCIES

 STOCKHOLDERS' EQUITY:
 Common stock - $0.005 par value; 120,000,000 shares
  authorized; 96,533,211 shares issued and
  92,179,460 outstanding as of June 30, 2008;
  95,848,711 shares issued and 93,191,191
  outstanding as of December 31, 2007                    483       479

 Additional paid-in capital                          105,919    96,749
 Retained earnings                                   432,691   353,648
 Accumulated other comprehensive loss                 (3,429)      (47)
 Common stock in treasury, at cost; 4,353,751 and
  2,657,520 shares as of June 30, 2008 and
  December 31, 2007, respectively                    (78,628)  (28,662)
                                                    --------  --------
  Total stockholders' equity                         457,036   422,167
                                                    --------  --------
                                                    $600,472  $544,603
                                                    ========  ========

This news release was distributed by PrimeNewswire, www.primenewswire.com

SOURCE: Hansen Natural Corporation

Hansen Natural Corporation
          Rodney C. Sacks, Chairman and Chief Executive Officer
            (951) 739-6200
          Hilton H. Schlosberg, Vice Chairman 
            (951) 739-6200

          PondelWilkinson Inc.
          Roger S. Pondel
          Judy Lin Sfetcu
          (310) 279-5980

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