We are an organic and healthy products company intending to become the world’s leading social selling and distribution company. We are a purpose-driven firm dedicated to providing healthy products to customers and inspiring them to “Live Healthy.” We commercialize our portfolio of products across more than 50 countries worldwide and strive to disrupt traditional markets with industry leading social selling tools and technologies. More than 75% of our revenue is ordered and fulfilled online with the products delivered direct to customers’ homes.
We compete in three major category platforms including health and wellness, healthy appearance, and nutritional performance. Within our category platforms, we develop and market a portfolio of science-based, functionally differentiated, and superior performing products and brands. We differentiate our products utilizing our patents, proprietary formulas and production process, and trade secrets and focus our functional differentiation using different combinations of:
- Phytonutrients and micronutrients
- Plant-based ingredients
- CBD
- Noni
- Clean/non-toxic ingredients
I included NBEV in the current survey of beverage companies because it is classified as "Beverage, Soft Drinks" in some databases, and when you do a survey, you would rather turn over more rocks, not fewer, when looking for gold. But NBEV is really a nutriceutical and health-conscious consumer products company, not a beverage company.
At the investor relations site there is a single investor presentation. On slide #5, they say, in a column titled "initial strategy", that they would have a "Portfolio of Healthy Functional Beverages" [bold in the original] sold and distributed via a "Differentiated Route-to-Market". What has changed is that they now want a "Portfolio of Healthy Functional (Brands)". This happened quickly, as they have acquired multiple large companies and then also disposed of a number of retail brands in the past few years. They have rapidly diffused their business into a large number of different product types, including:
- Limu seaweed-based (algae?) beverages (e.g. Blu frog, LIMU)
- Noni-based beverages
- skin care
- nutritional supplements
- DNA testing and diagnostic kits (MaVie); they are big on "Predictive Genomics"
The company makes a number of health claims for its limu-based products, and provides links to PubMed journal articles on fucoidian substances.
The company is also geographically dispersed, saying that they are in "more than 50 countries." The company fully believes in social media-based marketing and local independent agents (MLM?), and most revenue (80%+) comes from direct sales.
Financial Data
Data is from Macro Trends.
With acquisitions has come a lot of share dilution:
As you can see from the financial tables, NBEV isn't profitable, never has been profitable, and is volatile in part because it is constantly changing and re-defining itself. One possible route to profitability is that one of its many and varied products becomes a runaway success, even as the others struggle with losses. If that does not happen, then the company as a whole has unknown chances of making money in the future. We can't make any comparisons with KO, PEP, MNST, KDP, COKE, or FIZZ, because it is nothing like them. So far management has not yet shown what potential operating earnings they might generate. Without some way of estimating even prospective earnings or return on equity, we have no basis for generating a discounted estimate of cash flow, even one that computes an expected value instead of using a deterministic prediction. Hence, I have no valuation for NBEV, and therefore cannot determine whether its market price is above or below its value.
A few words about logistics. Beverages are heavy to transport, and a business model that involves shipping liquids, including possibly perishable liquids, through common carriers would appear to be working against distribution efficiency. Further, plant-based nutriceuticals would seem to work better when fresh, and that requires either very rapid distribution, refrigeration, or both. I didn't check product margins or prices, but this type of product might tend to command high prices relative to shipping costs, but if so, that limits the size of its market.
New Age Beverages's investor relations web site has SEC filings, press releases, and presentations; and it forces you to accept marketing cookies. At the SEC filings link you will find a Notification of inability to timely file Form 10-K dated 3/16/21, but then a 10K dated 3/18/21.
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