SBEV: Portfolio Generating Strong Sales Growth, As New Distribution Expands Reach

[Image] SBEV: Portfolio Generating Strong Sales Growth, As New Distribution Expands Reach Splash Beverage (NYSE:SBEV) is growing rapidly as it expands distribution for its portfolio of emerging alcoholic and non-alcoholic beverage brands. Over the past several months, several new agreements with distributors and retailers have boosted the reach of the company’s products, contributing to an 86% year over year revenue advance in 1Q22. Through its direct store delivery (DSD) and other distribution channels, Splash is gaining access to top retailers and expects to continue to expand its footprint. Focus on growing beverage categories Splash is building its product portfolio around changing characteristics in the beverage industry, such as consumer preference for more natural products that has led to strong demand for natural sport and energy drinks. In this category, the company has TapouT. In alcohol categories, the impact of flavors has been significant. According to industry market research firm [IWSR]( flavor is a “key driver of US beverage alcohol consumption.” IWSR notes that flavored subcategories are significantly outperforming traditional non-flavored sub-categories. In fact, while overall tequila sales volume has grown by 72% over the past decade, Splash management expects sales of flavored tequila to outpace general category growth and markets a line of naturally flavored tequila, [SALT](. In the wine category, Splash offers [Pulpoloco]( sangria and the convenience of individual servings with [Copa di Vino](. Moreover, as direct-to-consumer delivery continues to gain traction, a core strategy for Splash is to develop direct-to-consumer online sales leveraging Qplash, its proprietary e-commerce platform. Splash anticipates several benefits from Qplash, including the ability to incubate and beta test new and emerging brands. The company expects the online and direct-to-consumer sales channels to grow in importance and also yield higher margin revenue. Splash’s four brands include TapouT Isotonic Sports Drinks … Splash’s portfolio currently consists of the four beverage brands noted above, for which Splash continues to add new distribution. [TapouT Performance]( is a hydration and recovery isotonic sport drink that has significantly lower or zero levels of sugar and artificial flavors compared to most other sports beverage brands dominating the category. The category has grown dramatically as the beverage sector changes in response to consumers’ growing interest in healthier lifestyle choices. This shift in consumer preference has led to declining sales of soda, and healthier energy drinks have gained traction. Splash believes this trend bodes well for further growth of TapouT products as the company expands the product’s reach. … SALT Flavored Tequila… In the spirits category, [SALT]( Naturally Flavored Tequila is a 100% agave 80 proof line of flavored tequilas that Splash sells in citrus, berry and chocolate flavors. SALT is distributed by several well-established beverage distributors, including RNDC as Young’s Market, a leading and fast-growing distributor that is leveraging its ability to distribute both beer and wines in a footprint that encompasses 37 states and is expanding. The company has forged agreements with Total Wine, which has been in operation for 30+ years and is one of largest private wine & spirits chains in the U.S., Sams and Wal-Mart Spirits. SALT is available in multiple states and in Mexico and continues to grow its footprint. …. Copa di Vino, individual / portable wine servings… The [Copa di Vino]( single serve wine brand represents the company’s initial M&A transaction to complement organic growth. In December of 2020, Splash acquired the assets of Copa di Vino Corporation (CdV) for about $6.0 million. CdV is one of the leading producers of premium wine by the glass in the U.S., with seven wine varietals: Pinot Grigio, Riesling, Merlot, Chardonnay, White Zinfandel, Moscato, and Cabernet Sauvignon. The brand was even featured on Shark Tank. SBEV continues to expand distribution, including through Anheuser Busch distributors. Management believes this relationship enables it to gain shelf space for CdV in a crowded marketplace. …. Higher revenue/margins expected as SBEV assumes control of the Pulpoloco Sangria brand [Pulpoloco]( Spanish sangria currently offers four sangria flavors. Splash recently acquired 80% of Pulpoloco Sangria, which gives it control over manufacturing and distribution of Pulpoloco across the U.S. and adds international markets. The sangria currently is produced in Madrid, Spain. Splash intends to relocate production to the U.S. and expects to complete this transition by the end of August. Management believes it will enable SBEV to capture additional margin and revenue and enable shipping in greater bulk that will, in turn, accelerate the brand attaining scale and sales growth. The company also intends to increase marketing efforts for Pulpoloco. Splash’s Pulpoloco sales advanced 43% year-over-year through May 2022 compared to the same period of 2021. Recently, 7-Eleven announced that Pulpoloco was selected as part of the 7-Eleven Brands with Heart program, with distribution set to begin in September 2022. Pulpoloco founder Paul Daman will also join the Splash executive team. The sangria is packaged in an eco-friendly container, the CartoCan, which is made from paper and is 96% biodegradable. Given growing awareness and concerns about the impact of plastic waste on the environment and marine wildlife, the company believes it might have an opportunity to use the packaging for additional products and brands at some point and to include the ESG nature of the container in future marketing. New distribution extends & enhances channels, geographic market coverage To expand the availability of the portfolio, Splash has recently added distribution with many new distributors and retailers. In addition to a key agreement in place with InBev and AB-ONE, Splash has new agreements with publicly traded UNFI, Brewer Oil Company and Kalil Bottling, to name a few. Kalil Bottling is one of the top distribution companies in the western U.S. and this deal is expected to expand the availability of TapouT greatly. Management cites the Kalil Bottling relationship as a primary factor behind its recent ability to secure many of the new agreements with retailers and convenience store operators. The company also expects that making TapouT available in the “cold-bottle” category will drive significant growth for the brand. In the convenience store category, Splash recently extended the availability of TapouT in Arizona through agreements with three chains: CobbleStone AutoSpa, Carioca Convenience Stores and 4-Sons Convenience Stores. These chains manage retail locations across Arizona, some combined with fueling / service stations. These three agreements equate to an additional 86 high-traffic locations that are now selling all four TapouT SKUs. The company also forged an agreement with United Natural Foods (UNFI), as noted, to distribute TapouT in five southeastern U.S. states through Southeastern Grocer’s Winn Dixie stores in areas where TapouT does not have an existing DSD network. This represents a significant increase in the product’s reach. The company also believes that if consumer acceptance is as strong as management anticipates, additional UNFI locations will begin carrying the product, including both natural grocery chains and traditional retail locations. UNFI is the largest publicly traded wholesale distributor delivering healthier products throughout the U.S. and Canada. The company views this agreement as a milestone in its strategy to gain traction in the natural food channel. Splash also recently added distribution for TapouT through Save A Lot grocery stores, one the largest ($4+ billion in annual sales) grocery store chains in the U.S., with more than 850 stores in 32 states. According to management, Save A Lot added TapouT to its product offering after executives sampled the beverage at an industry trade show. Splash anticipates that following a successful rollout, it will add TapouT at all 850 Save A Lot locations in the U.S. Separately, in New Mexico, all four TapouT SKUs have been added to the product offering of convenience store chain Brewer Oil Company. Brewer Oil operates retail units adjacent to its automotive services. The company expects higher sequential TapouT sales in 2Q22 as distribution rolls out via new distributors. Splash believes TapouT is gaining market share from traditional energy brands and views the expanded reach as a way to facilitate this. In the alcoholic beverage category, the company also recently secured distribution with Mexcor for Pulpoloco, Copa di Vino and SALT Tequila throughout Texas. Mexcor is the third largest alcohol distributor in Texas, and one of the fastest growing distributors in the U.S., according to management. It services grocery stores, liquor stores, bars and restaurants, among other points of sale and consumption, providing DSD coverage in Texas, Florida and California. Management’s extensive industry experience helps secure new reach for the portfolio Splash management has extensive experience developing, launching and expanding several successful brand introductions, including in prior positions at other companies with brands such as Gallo, Red Bull, Bacardi, DIAGEO, Sparkling Ice, Jones Soda, FUZE Beverage, NOS Energy, SoBe Beverages, Muscle Milk, and Marley Beverages, to name a few. For instance, CEO Robert Nistico has more than 28 years of beverage industry experience. Prior to Splash, he founded and led the Marley Beverage Company from startup to $47+ million in annual revenue and ultimate profitability in 4 1/2 years and before that, helped build Red Bull from $0 revenue in North and Central America and the Caribbean to $1.6 billion in annual revenues. The company recently named beverage industry veteran Ron Wall as its CFO. He has extensive industry experience, having been CFO for William Grant & Sons, an independent family-owned distiller where he oversaw the planning and delivery of $500 million in sales for the North American and Latin American markets since 2009. He also served in senior financial roles at Diageo Plc. The company’s Chief Marketing Officer, William Meissner, has some 20 years of sales & marketing experience in the beverage and CPG (consumer packaged goods) industries. Prior to his current role with Splash, he was the CEO of several smaller beverage producers, including Sweet Leaf & Tradewinds Tea, Genesis Today, Tazza Pronto / Distant Lands Coffee, and Jones Soda, as well as CMO of Fuze/ NOS Beverage, among other high-level executive positions at various beverage companies. Expected product portfolio expansion In addition to enabling Splash to secure new distribution agreements, the company believes the expertise management collectively has developed in the beverage industry will enable Splash to introduce new products that can stand out in an otherwise relatively crowded and competitive marketplace. The company seeks to grow its brand portfolio. Splash’s strategy is to develop new innovative brands and also to strategically acquire beverages that already have market presence and brand awareness. Reflecting management’s industry experience and know-how, Splash believes it can accelerate the development of brands that have some level of brand visibility or competitive differentiation in their respective categories. Splash’s preference is to work with brands that: ▪ Have some level of preexisting brand awareness ▪ Have introduced some product innovation ▪ Are in a growing and underdeveloped category. Splash believes it can leverage its marketing and distribution know-how to expand the product’s regional presence, particularly when there has been some product innovation. To add value to its brand portfolio and generate shareholder returns as it continues to build revenue for emerging brands, the company also expects it could opportunistically divest more mature brands, a strategy that could enable Splash to benefit from private market valuation multiples that often range from 5x to 7x gross revenue. Given the pressure on core business lines as per capita soft drink sales decline, large players such as Coca-Cola, Pepsi-Cola and others have expanded their product portfolios via M&A in recent years. For instance, Coca-Cola acquired Vitamin Water for $4.2 billion in 2007, which represented an EV/sales multiple estimated at about 9.5x, according to management citing trade publication data. Larger players on the lookout for growing brands could portend well for Splash’s ability to divest certain brands. 1Q22 revenue growth primarily reflects management’s growth initiatives As noted, as the company has added distribution in multiple channels and geographic markets over the past several months (12 agreements signed in 1Q22 of a total of 15), it has produced substantial revenue growth. The company’s topline advanced 86% in 1Q22 to $4.1 million, up from $2.2 million in 1Q21. Reflecting SBEV’s growing product portfolio and sales, revenue has grown sequentially in each quarter since 1Q20. The company attributes the higher revenue primarily to increased sales from the single-serve wine business and increases in B2B and B2C ecommerce sales. Gross profit for the first quarter was $832K compared to $517K in the prior year period. Learn More about Splash Beverage Group by gaining access to the latest research report [DOWNLOAD]( This Website Is Wholly Owned By Tradigital Marketing Group, Inc. (D/B/A “Tradigital Ir”). Our Reports Are Advertorials And Are For General Information Purposes Only. Never Invest In Any Stock Featured On Our Site Or Emails Unless You Can Afford To Lose Your Entire Investment. The Disclaimer Is To Be Read And Fully Understood Before Using Our Services, Joining Our Email List, As Well As Any Social Networking Platforms We May Use. Please Note Well: Tradigital Ir And Its Employees Are Not Registered Investment Advisors, Broker-Dealers, Or Member(S) Of Any Association For Other Research Providers In Any Jurisdiction Whatsoever. Release Of Liability: Through Use Of This Website, Viewing Or Using You Agree To Hold Tradigital Ir, Its Operators, Owners, And Employees Harmless And To Completely Release Them From Any And All Liability Due To Any And All Loss (Monetary Or Otherwise), Damage (Monetary Or Otherwise), Or Injury (Monetary Or Otherwise) That You May Incur. The Information Contained Herein Is Based On Sources That We Believe To Be Reliable But Is Not Guaranteed By Us As Being Accurate And Does Not Purport To Be A Complete Statement Or Summary Of The Available Data. Tradigital Ir Encourages Readers And Investors To Supplement The Information In These Reports With Independent Research And Other Professional Advice. All Information On Featured Companies Is Provided By The Companies Profiled Or Is Available From Public Sources And Tradigital Ir Makes No Representations, Warranties, Or Guarantees As To The Accuracy Or Completeness Of The Disclosure By The Profiled Companies. None Of The Materials Or Advertisements Herein Constitute Offers Or Solicitations To Purchase Or Sell Securities Of The Companies Profiled Herein And Any Decision To Invest In Any Such Company Or Other Financial Decisions Should Not Be Made Based Upon The Information Provided Herein. Instead, Tradigital Ir Strongly Urges You To Conduct A Complete And Independent Investigation Of The Respective Companies And Consideration Of All Pertinent Risks. Tradigital Ir’s Full Disclosure Is To Be Read And Fully Understood Before Using Tradigital Ir's Website, Or Joining Tradigital Ir's Email Or Text List. From Time To Time, Tradigital Ir Will Disseminate Information About A Company Via Website, Email, Sms, And Other Points Of Media. By Viewing Tradigital Ir's Website And/Or Reading Tradigital Ir's Email Or Text Newsletter You Are Agreeing ----> [(. All Potential Percentage Gains Discussed In Any Communications Are Based On Calculations From The Low To The High Of The Day. We Are Engaged In The Business Of Marketing And Advertising Companies For Monetary Compensation. in Compliance With Section 17(B) Of The Securities Act We Are Disclosing That We have Been compensated A Fee Pursuant To An Agreement Between Tradigital And Splash Beverage Group, Inc. Tradigital Was Hired For A Period Beginning December 2021 And Ending June 2022 To Publicly Disseminate Information About Splash Beverage Group, Inc. Via Website, Email, And Sms. We Were Paid Four Hundred And Fifty-Five Thousand Usd Via Ach. We Own Five Hundred Thousand Restricted Common Shares Of Splash Beverage Group, Inc., Which Are Eligible For Sale On 06/02/2022. For The Purpose Of This Disclaimer, We Suggest That You Assume We Will Sell All Of Our Shares Once The Restriction Is Lifted On 06/02/2022. Tradigital Was Also Hired For A Period Beginning March 2022 And Ending June 2022 To Publicly Disseminate Information About Splash Beverage Group, Inc. Via Website, Email, And Sms. We Were Paid Six Hundred Thousand Usd Via Ach. We Own Four Hundred Thousand Restricted Common Shares Of Splash Beverage Group, Inc., Which Are Eligible For Sale On 09/05/2022. For The Purpose Of This Disclaimer, We Suggest That You Assume We Will Sell All Of Our Shares Once The Restriction Is Lifted On 09/05/2022. Tradigital Was Subsequently Hired For A Period In June 2022 To Publicly Disseminate Information About Splash Beverage Group, Inc. Via Website, Email, And Sms. We Were Paid Seventy-Five Thousand Usd Via Ach. Readers Are Advised To Review Sec Periodic Reports: Forms 10-Q, 10k, Form 8-K, Insider Reports, Forms 3, 4, 5 Schedule 13d. Tradigital Ir Is Compliant With The Can-Spam Act Of 2003. tradigital Ir Does Not Offer Investment Advice Or Analysis, And Tradigital Ir Further Urges You To Consult Your Own Independent Tax, Business, Financial, And Investment Advisors. Investing In Micro-Cap, Small-Cap, And Growth Securities Is Highly Speculative And Carries An Extremely High Degree Of Risk. It Is Possible That An Investor's Investment May Be Lost Or Impaired Due To The Speculative Nature Of The Companies Profiled.The Private Securities Litigation Reform Act Of 1995 Provides Investors A Safe Harbor In Regard To Forward-Looking Statements. Any Statements That Express Or Involve Discussions With Respect To Predictions, Expectations, Beliefs, Plans, Projections, Objectives, Goals, Assumptions Or Future Events, Or Performance Are Not Statements Of Historical Fact May Be Forward-Looking Statements. Forward-Looking Statements Are Based On Expectations, Estimates, And Projections At The Time The Statements Are Made That Involve A Number Of Risks And Uncertainties Which Could Cause Actual Results Or Events To Differ Materially From Those Presently Anticipated. Forward-Looking Statements In This Action May Be Identified Through The Use Of Words Such As Projects, Foresee, Expects, Will, Anticipates, Estimates, Believes, Understands, Or That By Statements Indicating Certain Actions & Quotes; May, Could, Or Might Occur. Understand There Is No Guarantee Past Performance Will Be Indicative Of Future results In Preparing This Publication, Tradigital Ir Has Relied Upon Information Supplied By Its Clients, As Well As Its Clients’ Publicly Available Information And Press Releases Which It Believes To Be Reliable; However, Such Reliability Can Not Be Guaranteed. Investors Should Not Rely On The Information Contained On This Website. Rather, Investors Should Use The Information Contained In This Website As A Starting Point For Doing Additional Independent Research On The Featured Companies. The Advertisements In This Website Are Believed To Be Reliable, However, Tradigital Ir And Its Owners, Affiliates, Subsidiaries, Officers, Directors, Representatives, And Agents Disclaim Any Liability As To The Completeness Or Accuracy Of The Information Contained In Any Advertisement And For Any Omissions Of Materials Facts From Such Advertisement. tradigital Ir Is Not Responsible For Any Claims Made By The Companies Advertised Herein, Nor Is Tradigital Ir Responsible For Any Other Promotional Firm, Its Program, Or Its Structure. tradigital Ir Is Not Affiliated With Any Exchange, Electronic Quotation System, The Securities Exchange Commission, Or Finra. Rua Frei Tome de Jesus N18 1Dto Lisboa Lisboa 1700-215 PORTUGAL [Unsubscribe]( | [Change Subscriber Options](