LaCroix brand sparkling water’s parent company, National Beverage Corp have reported a drop in quarter sales for the first time in the past five years. Perhaps the most popular sparkling water company of late, news of this decline sent shares of National Beverage Corporation tumbled at the end of this week.
A major contributor of this is LaCroix’s abysmal sales report of 53 cents earnings per share, this week, which is far lower than the forecast 76 cent earnings per share. More importantly, the company reported an earnings of 88 cents per share for the same time last year.
This drove National Beverage Corporation shares down 13 percent.
In response, National Beverage Corp CEO Nick Caporella lamented, “We are truly sorry for these results stated above. Negligence nor mismanagement nor woeful acts of God were not the reasons—much of this was the result of injustice!”
Fortunately, he goes on to explain his veracious choice of words.
“Managing a brand is not so different from caring for someone who becomes handicapped. Brands do not see or hear, so they are at the mercy of their owners or care providers who must preserve the dignity and special character that the brand exemplifies. It is important that LaCroix’s true character is not devalued intentionally—in any way.”
That said, revenue for the past quarter was down $220.89 million, which is 3 percent down from same period last year. In addition, net income fell from $41 million last year to only $24.8 million this year.
In addition, he adds, volume declines impacted their gross margins. “Comparisons were further skewed by the adoption of the new tax act in the third quarter of the prior year, which included credits and rate reduction adjustments aggregating $11.3 million.”
This data, he says, has not skewed the brand’s overall value or adjusted the future path of the company. Furthermore, he holds certain that consumers remain interested and committed to the LaCroix brand.
Of course, to say that sales of LaCroix might be slowing does not mean the consuming public is losing interest. On the contrary, this industry has more competition than ever before, particularly with big soda brands getting into the game; and that is making it harder for the little guys—the new, independent brands—to keep their heads above water.