Guru delivers a record Q2 2022 net revenue of $7.6 million, up from $7.1 million in Q2 2021.
"In the second quarter, we delivered our best Q2 topline performance to date with net revenues of $7.6 million, compared to $7.1 million in Q2 2021, while maintaining sector-leading gross margins of 54%,'' says Carl Goyette, president and CEO of Guru. "This performance was driven by a 26% increase in sales volumes despite the impact of COVID-19 in the first half of the quarter. True to our methodical and prudent approach, we delayed certain marketing activities to Q3, in the context of COVID-19 restrictions across Canada in place during our first quarter and first half of the second quarter.''
Gross profit totalled $4.1 million, compared to $4.4 million in Q2 2021. Gross margin was 54%, compared to 55% in Q1 2022, which the company says reflects careful supply chain management and prudent pricing practices. For the six-month period, gross profit totalled $7.9 million, compared to gross profit of $8.5 million a year ago. Gross margin for the period was 54% versus 64% last year. The decrease in gross margin was anticipated due to the change in the company Canadian distribution, sales and merchandising model, effective as of Q4 2021, and comprises distribution, selling and merchandizing fees. Gross margin was also slightly impacted by higher product.
Overall, the company says that, according to Nielsen, it continues to be the fastest-growing energy drink in Canada in the last 52 weeks and the top energy drink brand among adults under 25 in Quebec.
- Volume growth of 26% as a result of higher velocities, new product launches and increased points of sale in Canada, and entry in the U.S. club channel.
- Sustained, strong gross margin of 54% compared to 55% in Q1 2022, reflecting careful supply chain management and prudent pricing practices.
- Launch of the "Made in Plants'' marketing campaign and introduction of Guru Guayusa Tropical Punch across Canada, following the successful launch in Quebec where it is ranked #1 Innovation SKU.
- Strong financial position with more than $62 million in cash and cash equivalents, short-term investments and unused credit facilities.
- Launch of Guru's largest national marketing campaign ever this summer "Good Energy for the Everyday," activating all key consumer touch points: Comprehensive summer sponsorship and sampling program with more than 30 events from May to September across Canada.
- National out-of-home and digital marketing campaign in support of ongoing marketing activities running June through August.
- Official sponsor of CTV's The Amazing Race Canada, Canada's most watched summer series.
- In-store promotional activities in June and July in leading retailers across Canada.
"With a return to in-person events in Canada and with the majority of restrictions lifted since late spring, we have been going full steam ahead with our summer programming and marketing activations, building on our recently executed `Made in Plants' marketing campaign," says Goyette, adding: "This includes the launch of our summer marketing campaign `Good Energy for the Everyday' with digital, out-of-home, in-store and third-party event components, and a mix of sponsorship and sampling activities at various events across Canada throughout the summer. This comprehensive campaign will provide us with a solid baseline for our future marketing programs as we continue to build our brand awareness and reach new health-conscious energy drink consumers seeking natural, plant-based energy across Canada.''
"In the U.S., our strong growth in Q2 was driven by strong demand at the consumer level, as shown by Q2 SPINS data, with a 61% increase in consumer purchases in California, quarter over quarter, and a 31% increase in the U.S. overall, and by a limited-time rotational program in the wholesale club channel. We are also pursuing other selective customer acquisition initiatives in the U.S. and through our various online platforms,'' added Goyette.
Guru was recently named to the inaugural Future 50 Fastest-Growing Sustainable Companies in Canada ranking by Corporate Knights Inc., a Canadian media and research B Corp committed to advancing a sustainable economy. Selected from a pool of 6,115 Canadian public and private companies, the ranking is made up of the fastest-growing 25 publicly traded companies and the fastest-growing 25 privately owned companies whose business activities align with the transition to a global clean economy.
"At Guru, our mission is to clean up the energy drink industry. For us, this journey starts with clean, plant-based, and sustainably sourced organic ingredients, but it also touches on all aspects of sustainability, including supporting our communities and minimizing our environmental footprint. We are proud of being recognized as an emerging and fast-growing Canadian company with sustainability at heart, and we are committed to staying true to our mission and to meeting the expectations of our stakeholders as a responsible corporate citizen,'' says Goyette.
All Guru energy drinks are plant-based, high in natural caffeine, free of artificial sweeteners, artificial colours and flavours, and have no preservatives. In addition, all drinks are organic, vegan and gluten free.