Multi-Layered Strategy Catalyzes Celsius

By Max Rothman

In the past few years, Celsius CEO Gerry David and lead investor Carl DeSantis have sharpened the company’s strategy by focusing on sales of its single-serve cans, six specific U.S. markets, international sales and digital marketing. Results from the company’s fourth-quarter earnings report indicate that the multi-layered strategy continues to catalyze a brand not far removed from a nosedive.

“We are making excellent progress and our products are resonating well with consumers,” David said in the report. “I am very encouraged that we continue to deliver continued revenue growth. In addition, as a result of our marketing initiatives we are attracting new daily consumers and industry-wide brand recognition.”

The earnings report notes that at the end of 2013, year-to-year, Celsius increased revenue by 38 percent to $10.6 million, gross profit by 76 percent to $4.1 million, gross profit margins from 27 percent to 38 percent, revenue from international sales by 121 percent to $5.1 million and revenue from domestic sales by 2 percent to $5.5 million. The company’s revenue from domestic sales increased 48 percent when excluding Costco wholesale sales of $1.7 million from 2012, according to the report. The company’s net loss decreased 34 percent to $1.8 million.

In the fourth quarter alone, compared to the fourth quarter of 2012, the company increased revenue by 51 percent to $2.93 million, gross profit by 75 percent to $1.1 million, gross profit margins from 15 percent to 38 percent, net loss from $165,000 to $500,000, revenue from international sales by 57 percent and revenue from domestic sales by 44 percent.

David added that the company’s public relations efforts generated more than 750 million impressions in 2013 and that the partnership with Pandora radio continues to deliver 7.8 million ads per month.

In September 2011, DeSantis replaced Celsius founder Steve Haley with David. Under Haley, the company focused on sales of 4-packs in Costco stores, but sales figures declined. As previously reported, David said the decision to exclusively sell 4-packs was a mistake. On Sep. 10, 2013, DeSantis invested another $2.2 million in Celsius, which has financed moves such as the company’s international shipments to China, Brazil, Argentina, Paraguay and Uruguay.

In an effort to boost the brand’s resonance through a gradual build-out, the revised strategy has emphasized six markets: Los Angeles, San Diego, Texas, South Florida, Tampa and New England. David told BevNET in October 2013 that Celsius will focus on New York, Chicago, Detroit, Milwaukee and Iowa in the upcoming year.

The full earnings report is below:

BOCA RATON, Fla. — Celsius Holdings, Inc., (Other OTC: CELH) the creator and marketer of Celsius