Zevia PBC (ZVIA) 8 Aug 232023 Q2 Earnings call transcript

Good day, and welcome to the Zevia Second Quarter 2023 Earnings Conference Call. [Operator Instructions] Please also note today’s event is being recorded.

I would now like to turn the conference over to Reed Anderson with ICR. Please go ahead.

Thank you, and welcome to Zevia’s Second Quarter 2023 Earnings Conference Call and Webcast. Amy Chief and Financial are and Executive call Beckles, Denise Officer. today’s Taylor, Chief President Officer; On By now, presentation everyone second quarter should have access earnings release to press and investor filed morning. XXXX this the company’s is at website information of investors.zevia.com. available Relations Investor This section the Zevia’s on

XXXX. These based from risks materially call actual are Litigation a are call statements the and cause begin, today’s Securities beliefs on differ include of expectations forward-looking the Act subject which those subject management’s note described to forward-looking harbor presented concerning and please number and comments provisions Private could to Certain we all current the statements, uncertainties in unaudited. Before information that of future these made safe of events results financial Reform statements. that on is on this are to forward-looking

and those press that the with Please today. from materially actual release SEC to cause any in of could other refer discussion a risks statements forward-looking for expressed implied filings made or differ detailed to today’s the results

the accompany of measures investors.zevia.com. some the release measures on presentation business most that comparable at we describe measures earnings and comments filings non-GAAP The financial as and we use SEC During as performance. press as website financial GAAP are slides financial the well will non-GAAP reconciliations our today’s call, the available directly to all

I’d turn to to Taylor. the like now over And call Amy

the morning, to for everyone. QX good PBC. Thanks, Welcome earnings and XXXX Reed, Zevia call

accelerating Demand continues at disruptions, Zevia and as Zevia’s rolls rates. update to the the on the strong business. brand velocity Before an double-digit and refresh chain healthy. fundamentals remains supply I’d grow like the we provide to out address brand of is

reinforcing has positioning increase premium our gross Our been accessible received, margin price improvement. but well and supporting our

position, materially trip, interruptions our result expectation. short-term keeping for our for brand impacted transformation reflects fulfillment. cash by with our customer and order of investing spending as net demand for our the in our we and the are and strengthen brand in missteps future. preannounced, were a chain initiatives to while and the household the supply are interruptions is the We QX remain efforts. And up operations in in nature for to strong Consumer even in sales These on book

The we transformation said, support initiative ultimately, a costs the is points which service on and the enhance continued efficiency, to transition actions customer to some going course supply scale. correct we But Zevia’s and forward. of that and chain will them a focus old experienced to pain are critical new, our today our as I materially here drive from growth, expectations taking with in reduce we detail the

will XXXX. for profitability, would and significant The Zevia and Customer The for one broader proposition like over steps challenges exciting the and are fulfillment in continue short-term portfolio for the and consumers. supply margins we optimized bolster of the the brand that come. the meet to today’s year-end reflecting the demonstrates in taking tomorrow’s years stabilized improve product and to potential needs by potential to measured via and chain remains the Zevia’s is of be a which take value main message long-term you that very beverage, call relevant, has the that exciting in data XX% today’s velocity scan, the of demand quarter reflected most from away all I category. the in

even market. plastic sold with as in in price for more beverages another on and from realize planet. sugar people we in affordable in bottle. than And of we of QX, having North metric X,XXX a focuses consumers’ mission never the XX% keeping is Zevia health global nonalcoholic the Zevia’s diets removed tons America,

is affordable continued for income across consumers and levels. available Our them all focus mainstream, making beverages taking better-for-you

refresh our focus for going the strong to us through walk sales retail the forward. $XX.X was will and and in clear our and below where delivered net across sustained double-digit We is brand I were So now select sales the bolstered scan not quarter service growth market Velocities in of expectations data. then and speak customers quarter. second and by interrupted levels as million were results

Our expectations was across at order the or quarter. book above

a refresh, We’ve Gross our sales benefit as foundation from implementation strategy ambition accounts national cash our margins we a this field will price We’ve to moved continue to year. to and improve. team these model growth. deliver position sustainable profitable account focus on management, a demonstrated of disciplined brand collectively, increase we’ve believe adaptations and the strong immediate reinforce our from promotional key realized with strong to and strengthened initiatives us

I’ll speak above trip X%, scan increased data consistent and walk with spend insights, households indicators panel penetration are once strong base. are through rates. retail evolution brand in user Zevia’s health putting our to place customer increase their and X% household of driven of to frequency our and purchase the I’ll brand then by measures fulfillment. our by address remained indicators via in and we Zevia’s consumer X% again, the per us and These spend base another

strong We in cola of the single also item form vanilla packs. and sales can performance saw XX soda new

quarter, point the brand. distribution. double-digit XX.X% Zevia stock, The velocity scan one, a We availability, that, of most is grow is which our and desirable trial. at we in growth a price in less metric build business key stocking as per shopper remain Zevia velocity, the all quarter Zevia are important simultaneously a demonstrating when competitive brand, brand highly to advantage cold a of The remains sales grew singles remains sensitive which levels. driving home income

on shoppers. versus shoppers beverage more XX% total spend nonalcoholic beverage Zevia

XX% spend further make shoppers and themselves Zevia from they to stores more beverage to continue purchase beverages. continue also differentiate trips overall. as even more shoppers brand to the Our shoppers average on to

prior lift. on words, the second supports of sell and continues informs which We other in existing promotional year versus to dollars more also new retail to promotion profitability going the Zevia our quarter forward. improve fewer merits Our had effectiveness on we but strategies to brand increase, continued and XX% sold the consumers. In

We’ve mainstream across pack channels. new incremental with natural, trial there, We natural and with in grow format growing fastest-growing in sodas distribution established continue retailers to our now shoppers. single expand whole legacy our channel

soda have energy gaining grocery We’re distribution we East drink in in single new Midwest distribution and West, And well. conventional as chains. regional

bodes largest drink customer and at of performance starting stores with channels, One strong expectations or the drink finally, we is the for in channel X we in the nationwide to the September. in has that and country’s have performed XXXX. carbonated drug moving continued each chain aisle well And expansion Zevia future test Zevia top carbonated very world’s soft soft expansion. aisle in with above into mainstream retailer, which in anticipate resets chain expansion in

flavors our packaging. efforts the broader past and will now address We’ve positioning year, In cost have singles professionalized the and launched redefined management. top-performing new and the I attention fulfillment. built distribution, direct and management in accounts customer X expanded with entered So through formats, to and taken the key have new team, category successfully Zevia we business, increases cash step-changed operational our a brand keeping price

the streamlined, results chain a also built of to for This right Zevia At strong is supply initiative a when deliver deliver we transformation QX, we’ll and supply for and efficient complete. chain endeavored effective the scale. end

for missteps continue net in that QX have experienced expect however, with QX. short-term We we execution, material its in to impact sales on

the partnering X challenges, deliveries, steps warehouse at and SKU we to partners, following our to which consolidate we network inventory from taken XX impacted locations with capable a proven we and X, have level, and then and customer inventory correct. As accuracy encountered management course transfers timeliness,

in Officer Monster step-change Firstly, chain X contributors SVP operations. Supply we us in-house Williamson, Energy. to of July joined also have a hired and Chain in Bill has hired new already manager Chief who Bill experienced supply level Operations new from

Secondly, network, leveraging through warehouse providers transition the days all plans transition SKUs. supply rephased we ample for for legacy support of across with our

practices costs. we our new to effectiveness mapping support reduce approach for and early then customer we our And QX. finally, to improve efficiency. Thirdly, sold the third-party to to efficient company-owned and we transaction service of mix This fulfillment and levels in model embrace our and divest ordering customer network. changed Fourthly, freight closed warehouse established

As evidenced strong. scan, in our remains data via demand velocity

The raw the required place. are logistics steps centeredaround are finished in Our are forecasting issues and and and strong. it clear materials customer and goods fulfillment capabilities fix to and supply short-term

a high level of a are long strong future transparency of expansion history partners. retail partners have customer providing to this We and fulfillment them, with retail transition with and through our support our distribution protect

very model a for the and Denise. has I’ll to business and consumer the experience and it increasing spending big strong healthy Zevia wrap with brand. households brand over turn on demand, to picture continues

strong chain, retail new and to grow partners track strong #X We are on consumer acceptance, distribution, and service we and are long-term gross and returning price delivering the to our in market the growth. supply back And so delivers profitable we velocity sustainable, margins. it in stabilize transformation with of our in priority driving and that is legacy our in meantime improving continue the best-in-class to levels realizing objectives network our putting

I’ll it Thank you, hand and Denise. to over

morning, everyone. call Amy, your begin will open discuss with you, second overview our of the I then questions. quarter results, Thank and good for and guidance an financial

a adjusted delivered offset price and we our will the XXXX, million, the shown with next. to million our our positive impact supply and a versus fulfillment. of XX.X% margins, $X.X strong, fundamentals We increase August same did in of chain discuss EBITDA delivered strong business the of the X.X% positive XXXX, of of cash volumes of impact quarter remain prior from second lower disruption implementation increase in our the which coupled management gross million, which time as order from in sales decline by down in In see our year. period, net key $X.X or I due But price $XX.X quarter,

higher margins public of due increases X.X XX.X% a quarter points yet second quarter from tailwinds Our our XXXX. labor aluminum year XX a basis primarily with the associated improved ago, volumes inflationary by of slightly margin XXXX, and as the sequential as impact and continued and price costs, improvement for of costs manufacturing a pressures strongest by company same versus with to fees QX Gross sequentially margins the also result lower above lower gross points higher at rates. offset

year-on-year the marketing additional freight and million, of X.X% a versus XX.X% reflecting marketing increases in $X.X year in sold, per Gross million. to in million warehousing $XX.X million, period or $XX.X a disruption in and $X.X rates to supply Selling $X.XX ago. was increase X.X% expenses increased primarily of profit up the initiative the in chain and period cost transformation unit investment and due delivered

costs, $X.X or a XXXX, of second of decrease period of XX.X% employee net percent $X.X quarter costs. net spend lower of sales. to was million same as time a million noncash G&A the $X and compared of in public compensation, discretionary second compared expense, company X.X to XXXX million decrease as of or in net XX.X% year. The XXXX a last was quarter year-on-year to dollar was the attributable sales expense Stock-based million sales $X.X second of the in points

in $X.X share compared common loss of a the EBITDA to of was a of improvement million an was quarter the XXXX, of adjusted of Class in $X.X Zevia quarter $X.X million of $X.X an of million share shareholders loss loss of $X.XX loss quarter compared XX.X% compared XXXX. $X.X Net to improvement $XX.X XX%. Loss in of XXXX, the was second million as $X.XX per loss second EBITDA the to quarter of a per share second last or or year-on-year compared diluted A to Adjusted second net year. million million per

as remains second Our the million. was equivalents as million end sheet credit and and quarter of capital debt unused cash of in line period cash the at of well $XX.X of healthy an outstanding $XX XXXX the $XX of Working million. balance as with end no the

guidance. to Turning

$XX million Our guidance reflects that logistic $XX will is million QX which XXXX, impact in the on including continue $XXX QX. $XXX XXXX of annual million, challenges material chain supply net our to to have expectations sales to million a

and supply current negatively year not adjusted adjusted actions EBITDA, provide associated guidance take margins EBITDA the expect disruptions and While corrective on impact of and do supply costs margins chain the the transformation we with we chain to resolve we gross complete to and as invest disruption. transformation to remainder our both gross over the do the

our concludes remarks. That prepared

questions. call We open for the your Operator? now will

first Bonnie Today’s from Herzog Goldman question [Operator Sachs. with Instructions] comes

first quick products. Amy, demand, right. a mentioned the had that to question All you underlying your I on

so actually far? and or in demand think July has Just should August wanted QX? of to more in about confirm share? saw how you Or it that And could just days early accelerate consistent? then remaining broadly trended just pretty month-to-month if And curious we demand strong you

Sure.

as month strong acceleration And has in then investment growth the -- the half accelerated. of velocity we So lift part we XXXX. our necessity, dollar and demand of and in saw so of out year-to-date throughout July, year-over-year our reduced saw first has has promotional improved

at data promotional retailers just growth. so posting through reduced dollars period sales posting example, -- and XX, accelerated July of July on X out And we in dollar for top all looking soda prior data XX scan improvements and scan materially versus saw, our

So answers hopefully, that Bonnie. question, your

a that No, color. now my Yes. what just guess, of you I QX was improvement then top is shared of for helpful regarding on line kind on bit question, which full quite year And your second guidance, calls in QX. based

in beyond, about everything in it’s is realistic And and but any improvement the cetera. whether for you top working the understand do So your this a been refresh, made, visibility what to and recognize I of was just early, it’s that -- have line see et growth, you’ll thoughts of I light growth what’s on think your thinking acceleration then investments on, outlook just the you confidence type the you’ve year hoping you’ve QX. brand next better business

Sure.

remained strong year incremental and So is or And can brand marketing refresh and having by the the without in with spent is see that trial. impact the trial, visibility brand an dollars velocity throughout we consumer in obviously new that fundamentals simply place, already on-shelf the the driving demand has health strong. are and

customer challenges. recent space at with We our haven’t retail of fulfillment loss any experienced

customer explains to growth return that a we of is impact on levels. to our I matter the how think to just realize net being on normal demand. quickly actually can of simply fulfillment sales bullishness return And So our consumer QX, able

And our outlook future remains for the bullish.

double-digit a brand. are growth we So

our it support in in and You a into had to sales. sales, in XXXX net of our we’ve such shipments increases we we’re to that and distribution in that scan we between response based can in growth. also and expect also distribution expect market. strong price And that the on balance a see velocity, growing return course, expansion velocity We’ve put to

so further as well. that that indicates price room have in And we

between in expect velocity expansion. XXXX, we distribution in a price growth So then and would and mix nice

Okay.

Just want maybe I on. something, pass and then it confirm I’ll to

the QX, that’s will about we should really you’re going the by to just supply the doing So clear, that’s and resolve be QX, super will time chain disruption then and given accelerate, where throughout et to cetera. helpful. And fixed it, still the to thinking you’re underlying that we some be work things then hit assume face impact. But demand,

definitely there. regard we’ve clarify QX. can and on And recovery and fulfillment back always through aluminum to quite the line that the in the levels really been just COVID including best-in-class acceleration then about prices, the chain reliable with fully time the supply You’re to competitive sustained past, through we’ve to in and right optimal of

line take time to or and be definitely shape fix year-end, good or so by but months do impacting be will before year-end, Bonnie. weeks as QX. the we we’ve expect we to so It in there, before expect to not And said, by

Very Okay. helpful.

our Junquera And question comes Bank next with America. from of Christian

this impact? impact upcoming the and selling share magnitude quarter. have in Can you Bryan. expect expenses. remarks, mentioned Denise, believe for to gross transition gross quarter? mid-XX% the magnitude operating impact trending the of expenses just You we the margins your the and for Christian on that margins at Should end of that negatively on supply will I third how been marketing the decelerate and They’ve prepared chain of you

anticipated cost quarter higher this could us? you there if with For instance, was it don’t share we onetime I this quarter. that a know in than came

Sure.

to that the to it lumpy. chain. in will On we we to are happen margins, gross mid-XXs. with the to going we happening to continue expect on the We anticipate So supply be we remain through the fourth it costs pressure, mid-XXs. what’s expect Costs Though selling third accelerate to be year, adjusted the primarily in of quarter. primarily rest related it to expect expect see EBITDA, in and

to we at in the and expect QX So be we it level QX. don’t see

we we Does quarter. do expect that late see answer normalization does the you in -- However, some that will give your question? fourth that

Perfect. for Yes, follow-up that’s very quick just one me. then And helpful.

brand the what are brand reads to early you what just -- any And retailers saying? the Just that are some consumer from the refresh, are guys the you of internal metrics used success to gauge and using refresh. of guys

to health the household lens to brand of loyalty. job and -- and build time, refresh’s penetration to image is expand brand is win our the love brand consumers and Over new through Yes. and then Sure.

of measure And the increased merit such space, our early to and refresh. look as brand. a a or or indicators all very so consider seeing consumers in-store are be based as and engagement retailers saying feedback. this. category from positive and to feel my frequency a with the and consumers, those now, we’re success media seeing but new early It’s anecdotal. lot it a in driven where would increased merit obviously, the But both we’re Anecdotally, our of it’s and posting engaging, far that fits vibe be of the in on retailers influencers of improvement this present display accessible relevant engagement again, brand refresh, new visibility most premium But we is game, on fairly Zevia early brand comes lot retailers Zevia brand days, very merit still social reposts happy based anecdotals, energy. on And too from that the

levels since the have accelerated we we’re sort been of beginning of off-shelf think the execution. particular anecdotes the in growth consistent retailer able of is power, XX%. promotional the important to in to of the strong time, with more and our in period the holding period the refresh share has And particular reducing one shelf been year, of to because in-stock displays where this period maintain one In for retailer, top I brand July XX% ending ample same but store. by spend XX from

and highlight this brand Zevia just merits to brand will more is continue. I so belief are of it that And selling our on refresh the post the say, we that that,

merits the expanding of and ultimately So we’re presence trial, very efficiency refresh bullish the growth delivering in-store and brand improve the consumer expanding brand. on base, helping to on lift

the for So thanks question, Christian.

I’ll pass it along.

And from with Salera question Jim comes our Stephens. next today

on to chain is once going Amy, on kind acceleration Is just having the ask reoriented. kind from better of come rates the the in-aisle supply I that all that to wanted fill of gap products offering? and having that product of the the consumers allow shelf to SKUs and displays deep? to going of several is more traditional visible displays for in-aisle Or outside kind

you’re of reasons. a doing great down breaking job Jim, both

we had So can is XX%, bit reflected a there. effectively, million, And the demand the it display our and so in you $X we little quarter, that fill bolstered filled growth scan of on-shelf color, fact, know our about from would perspective if more at I sales if would scan rate gaps, for have and rates a give our have expectations. meeting

to new our you demand both which product your execute words, to multiple be that and shelf parts in of have to filling returning and mentioned, question, incremental reflect return actual as what shoppers the of is, individual it to in So sales at store. net stocks on to things to will other flavor of shelf growth well is -- depth ability display to the answer SKU our a the drive avoid to as activity and interrupt out promotions

that back on to issues. fulfillment to customer having a currently of off degree our We’re based

able to we’re then also soon as able to So in-store as the drive demand, we’re presence. fulfill

Jim? those brand Zevia back shelf doing at positive of that customer the both early considerations underlying display of And to to sort and expect given fulfill fulfillment we when their comes online. further job that So Does and indicators. returned to executional yes, that help both help, demand, accelerate refresh

soft any XX least I question a along great. tea like broader more offering for could ask team SKU the across with or opportunity you representative that how distribution. SKU. kind I’m to in Yes. run But the you pack for area, there distributed? multipack energy Is tea get relative do have club? too. not with club club at of to my maybe broadly then for energy energy area sure drink And Yes, the can SKU I if know, SKU club on a in my that’s the and and in we club, is a think

our absolutely intent. we can, We that believe Jim, that is and

so And on club regional every to buyer has that surprised positively chosen down Zevia double soda soda. in has

again, energy early doubling rates days with early in expectations, so tea. you’ve drinks of rotations We’re the observed. as tea we’re sometimes minimum very And business. hurdle the in And

Zevia and is the taste. a clean in refresh energy feel. drive drinks awesome upon new visibility which accessible to because option position, Energy versus We feedback to brand that in we’re broader design of but our the at materially new seeking starting based getting. and price brush with feel the And look old represents put this better wanted that the now consumer We’re premium the pure front the is a we energy look and feel,

could So energy the the club exciting continue to proposition believe reach be consumers an more with well. to way as we distribution

upside. to of So to tea yes of as club energy and and the club future yes, future and the

it pass along. I’ll Good.

Vora And our Sarang Group. from Advisory Telsey with question next comes

Great. the your based seems certain comments, did is chain. on customers strong Sarang Vora supply first for sales, Dana question like, It had not. Telsey. certain on My

supply impacted So on like Just regional, impact provide bit more particular, customers, it color how taking to this can know certain brands little you tea was cola? it provide a the trends. chain you curious and impact on step a current can did deeper in or

promotion. and stock have in we’re some stocks customers higher-level pretty was performance. in thus country support a the individual further And some across Yes, able in question. say, when fulfillment not did more have they geographic instances, from than remained you outsized Sarang, customers into others the our on period it while an In to the perspective. thank the had impact I others, customer ordered past, than would even instances dynamic challenge unfortunately, for better

remained largely stock, that promotions So country. make retailers the sure that was challenging across in but with

think the is customer answer your category geography, equal country. way So impact relatively and lens was the question to I across of the simplest through the

He’s And fix full confidence to Bill I’ve support taking in at people operating started has transition. end to time partners July, functional providers in with demonstrated mentioned the swift processes slowing tools our Williamson, it’s the and it’s the function just during to and support that, mid-July the of levels team team, drive the of leading then and out so team, with we’re us then and with from ability impact these legacy our understanding brought to remarks, He tremendous on drive the action, with then who our exit with the areas our energy changeovers X swift in some third-party stood and decisions improvement. as and prepared to new then daily necessary up tasks gate. their warehouse during and key service

and returning So to customer on we’re geography, across best-in-class bullish category levels. service

at brand point, been rebranded. done the packaging, great. of the profiles? across labeling, your has everybody on That’s -- And just been Like refresh, this all that has

just Now, refresh of the step about to the fair is that Is steps? next a and brand marketing think distribution. way

right, That’s Sarang.

line off Zevia. the So now is everything brand new coming

a retail, So approach rolling that launch. feel. production look work through old through we we’re sells from taking vary perspective, at quickly we’re in And to how everything fully because now as you the will and producing the know, that a

feature, as tea and And months sells the through. on the Zevia example, so old next old handle have issues several shelf through will year-end. new for shelf and for don’t We same we any life some time can customers that transition at

customers end right. by year, So brand with locked some think fully fully we in on shelf. volumes, are and in we’ll to feel many faster But individual look be the geographies new the already I of and with

that’s great. No,

Carey Fargo our Chris today comes Wells question And next Securities. with from

So supply for way that the not that Zevia you’re you’re it But I you ease penalty time a for guess in once lot really supply the that you certain chain box bullishness I’m that have work dynamic situations, hearing be and will when headwinds Typically, the be your you more put could impacting support of a sounds I like getting and back support. guess retail. chain at is of such in. amount none are even the what getting actually a issues of

characterize just do once so you a to it that is I that And guess, helpful. so, like performed be situation? is? think it’s the well there Is So perspective brand shell? And the why on would fair that so way if any

and retailer as fulfillment can mentioned help minimal sustain Thanks, your Yes. COVID through of all understand a virtually interruption. I before, stand really all One is is be and legacy that this to on the And uninterrupted. through we with best-in-class service. think, I X aluminum wouldn’t are crisis, our rates accurate were I Chris. There factors, initiatives right? without say And it misstep impact, question. that us relationships drive in

some So credibility calling to sustain and on as soon have service the course as that charting sort ball we stabilize. we think a in of I best-in-class

our can to of But for our outlook, the transparent. our regularly of and expectations very on when at secondly, level, them best sort on deliver we how a PO retailers, been Coming just we’ve updating to them ability, giving them. getting

be good partner standing credibility the So a also doing together mitigation short-term plans on best on our and we’re in work with from to disruption retailers past. the but

period we but that’s the is activation fair time. impact, we don’t And protect say then I that space during I that of we’re space. once and to important expansion this thing activity would without losing don’t think return So and most And in-store our display anticipate it to stabilized. be we’re we’re

question, hopefully, Chris. So answers that your

as come back, to other higher just or on going perspective. back going or would said get like that you’re one way, another margins at be good yes, No, be margin marketing, sales there’s not only really sales it Yes. this be, behind the remain come The a gross investing sales that’s back as a to sounds trade-off level.

make Just as to well. wanted sure I that understand piece

-- expect the to margins said before, remain mid-XXs. think in Denise as I so we

by unaffected matters answer in question, will similar year. to last I outlook on to challenges inaccurate we’re costs And a some be selling EBITDA would say lumpy will as supply our result, that. be chain, reflecting the think the the increased there meaning adjusted costs it to your in the be to like

of it So that months creative perspective. been where would optimize we adjustments spend marketing omnichannel of we stock X the do our then making we to the purchase in of form One campaigns phasing geographically locally driving a have to say from in hitting light cost levels And doing point intact. unaffected be inaccurate funnel building. in the sampling to some But to top we’re are in in-stock support close the the to have QX is are issues. brand and coming in markets largely targeted market thing

So will into brand, a investments there we make cost to will stabilizing be supply chain. and the the

Let you there if me Denise if and can a follow-up provide color. question have see

got I’m okay. I think I it.

So we I expect a and think lumpiness some understand. digesting you’re marketing, facing be going as costs, you’ll little I to be bit of

Thanks, Okay. Chris.

And our from Andrew next BMO question today Markets. Capital comes with Strelzik

is with to packaging? of Gold it more Strelzik. and more the This go Andrew is year with versus you some shifted? that it are changes the brand Or to on refresh? this How depleting the market year original the products thinking about Daniel for about Is next

and And and efficient consumer the is as important brings thing most The that dollar, investment well the on a and make. relevance their shelf most refresh pops the it is visibility for in-store. can dollar as in-store hands impacts brand about for brand this Sure. brand in

XXXX. do and You happening that’s in-store with can it right out rolling once, but now only impact in really

and of mentioned of the own will by expect as to as on in next refresh the schedule up more lift distribution trial, we marketing investments on is ramp start So I in we it months. but before, brand against forthcoming and few own increased well, informed will bring merit impact its some omnichannel campaigns its XXXX, increased learnings the

marketing These are we used inform campaigns the tactics these learn our order moderate spend, for omnichannel but from can plan in year. next to in

and the light-touch is It brand marketing next. So brand refresh question, to more and trial in-store significantly pull-through the support your planned. in year with activation, out visibility, rolling driving answer it supports further the and by interim then we’ll this as now

as you’ve shelf brand now the Got favorable with follow-up a got it. long-term to And implications that space refresh? what a more the that, are

Sure.

the shelf most for trial. the speaking, to And of drive store. opportunity for Zevia brands, awareness driver in beverage, is biggest awareness and for So is -- #X generally

improves we takes we and as consumers that it support that, net space, down So funnel awareness, the our expect to trial expand sales.

So of to mass expanding a in the purchase it drug selling we’re the in of expansion out the ultimately that same-store dollar in be convenience into impulse there’s drivers and winning new several are and growth get is for channel, and distribution channel, of cracking well new channels it of space store as sales fundamental being where lot shelf further sales ahead years quickly come expansion single as closing can in opportunity our because to food throughout club, gaps then finishing now service. growing and

gained. selling you distribution velocity, is also facing we So but expansion be can have same-store upside lot to see how a of in supports

me. for all That’s Right.

question-and-answer our back the session. concludes ladies over any gentlemen, remarks. and Taylor conference I’d Amy this like to And closing to for turn

very velocity plague. our close position, is healthy the everyone. are us just that now, brand and as and strong expansion Thanks shelves very cash as fundamentals refresh as exciting that our is by Zevia’s further hitting reminding we’ve indicators, ever, by much, gross strong, brand margin our all discussed, I’ll bolstered, an in

returning a profitable months our service levels best-in-class in support to see the so path we clear to coming and growth. sustainable our And

with So thank morning. you time us for this spending

today’s call. Thank thank presentation. today’s attending you. This for conference We all concludes you

your now a wonderful lines, may have and You disconnect day.