Alkaline Water Company (WTER) Reports In-Line Q3 EPS, Revenues Beat

Alkaline Water Company (NASDAQ: WTER) reported Q3 EPS of ($0.06), in-line with the analyst estimate of ($0.06). Revenue for the quarter came in at $10.18 million versus the consensus estimate of $9.58 million.

Key Highlights:

• Fiscal 2021 third-quarter record revenue of $10.2 million increased 20% year-over-year.
• Fiscal 2021 third-quarter earnings per share of ($0.06) improved by 14.3% compared to the prior-year quarter, of which ($0.01) was related to non-cash expenses.
• Direct Store Delivery (DSD) network now reaches over 10,000 customers.
• A88CBD™ line expands national distribution network with KeHE, UNFI, BettermentRS, and broker C.A. Fortune.

“We are proud to announce that we delivered record fiscal third quarter revenue of $10.2 million. Our E-Commerce, A88CBD, single-serve offerings, eco-friendly aluminum bottles, and flavor-infused waters all contributed toward the record. Each business line continues to grow, and we expect a significant contribution from them over the next 12 months,” stated Ricky Wright, President and CEO of The Alkaline Water Company. “We are excited that the momentum we gained over the summer in our flagship brand Alkaline88 continues. Based on 13 week Nielsen scanner data ending 12/26/20, we continue to be the fastest-growing top 10 value-added water in the country. We outperform the category volume growth by almost 2 times and the unit growth by over 5 times. We are now the 8th largest vendor in the category. We see continued strength in the 1/23/21 Nielsen scanner data as well.”

“We believe that the strategic actions we have taken this year position us for strong growth and anticipate solid returns from the investments we are making in the coming fiscal year. Since the end of the quarter, we are working tirelessly on several initiatives. These include expanding our DSD strategy in strategic regions. The expansion plans should allow us to reach an additional 40,000 to 80,000 customers in the all-important convenience store channels. Based on the changing shopping habits of consumers, we have allocated additional resources to our E-Commerce and digital marketing strategies both in the water and CBD categories. We have tested and will expand on programs that have shown extraordinary ROI’s in our test markets. By expanding our outlays to these water and CBD initiatives, we expect to drive a significant amount of sales through both our E-Commerce sites in fiscal 2022. Our products will also be supported by our first-ever traditional marketing campaign led by the Davis Elen agency.”

“With the change in administration in Washington, we are hopeful that we will finally get clear guidance nationwide for our A88CBD products. In anticipation of this, we expanded our retail distribution network for our A88CBD products through KeHE, UNFI, BettermentRS, and C.A. Fortune. We continue to leverage our existing relationships to penetrate the brick-and-mortar retailers with our A88CBD products and expect to be in thousands of stores in the coming months.”

“On the operational side, we are in the process of expanding our domestic capacity for our raw materials and increased finished goods. We will be announcing new plants and new raw material providers that should increase our overall capacity and positively impact our gross margins. These initiatives will support all aspects of the anticipated growth in E-Commerce, A88CBD, Alkaline88 single-serve offerings, Alkaline88 eco-friendly aluminum bottles, and Alkaline88 flavor-infused waters.”

“In addition to increasing our gross margins and capacity, they will significantly decrease our carbon footprint as our new vendors will be closer to our existing plants. Since inception, we have focused on having the smallest carbon footprint per liter of any major water brand. In the past 52 weeks, we have taken major steps in reducing our carbon footprint. We have already begun to include 25% recycled PET in our bulk sizes. We continue to focus on sustainability throughout our new initiatives, as demonstrated by being the first national water company with an aluminum bottle. We are a Clean Beverage™ company and care about not only what goes into our products but what we can do to minimize our impact on the environment.”

“These and other initiatives, including international expansion and the rebounding hospitality industry, should contribute to significant revenue growth in fiscal 2022. Our Company and its operations are well-positioned to be an omnichannel lifestyle brand in fiscal 2022.”

For earnings history and earnings-related data on Alkaline Water Company (WTER) click here.

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