""Our commitment to effective cost management drives our ability to sustain profitability in challenging market conditions."" - CEO
National Beverage Corp (0K50.L) QQ3 2025 Financial Results Analysis
Executive Summary
National Beverage Corp reported mixed results for QQ3 2025, revealing a revenue of $267.05 million, which marks a 1.12% year-over-year decline and an 8.29% drop sequentially. Despite the declines, the company showed resilience with a net income of $39.64 million, reflecting a slight year-over-year increase of 0.13%, though this was coupled with a more considerable quarter-on-quarter decrease of 13.13%. Management emphasized their commitment to product innovation and efficiency improvements during the earnings call, highlighting strategic investments aimed at enhancing operational capacity and diversifying their product lineup to capture health-conscious consumers.
Key Performance Indicators
Revenue
267.05M
QoQ: -8.29% | YoY:-1.12%
Gross Profit
98.95M
37.05% margin
QoQ: -9.51% | YoY:-0.21%
Operating Income
50.58M
QoQ: -12.60% | YoY:0.54%
Net Income
39.64M
QoQ: -13.13% | YoY:0.13%
EPS
0.42
QoQ: -14.29% | YoY:0.00%
Revenue Trend
Margin Analysis
Key Insights
Total Revenue: $267.05 million, a decrease of 1.12% YoY and 8.29% QoQ.
- Gross Profit: $98.95 million, indicating a gross profit margin of 37.05%. This represents a marginal decrease of 0.21% YoY and a significant drop of 9.51% QoQ.
Operating Income: $50.58 million with an operating margin of 18.94%, showing slight resilience with a 0.54% increase YoY but a significant decline of 12.60% from the previous quarter.
- Net Income: $39.64 million, equating to a net income margin of 14.85%.
Cash at the end of the period stood at $149.22 million, with an operating cash flow of $46.53 million.
- Current Ratio: 2.95, indicating sound liquidity management. The company has manageable debt levels, with a total debt to equity ratio of 0.138, suggesting low financial risk.
Financial Highlights
1. Revenue Performance:
- Total Revenue: $267.05 million, a decrease of 1.12% YoY and 8.29% QoQ.
- Gross Profit: $98.95 million, indicating a gross profit margin of 37.05%. This represents a marginal decrease of 0.21% YoY and a significant drop of 9.51% QoQ.
2. Profitability Metrics:
- Operating Income: $50.58 million with an operating margin of 18.94%, showing slight resilience with a 0.54% increase YoY but a significant decline of 12.60% from the previous quarter.
- Net Income: $39.64 million, equating to a net income margin of 14.85%.
3. Cash Flow and Balance Sheet:
- Cash at the end of the period stood at $149.22 million, with an operating cash flow of $46.53 million.
- Current Ratio: 2.95, indicating sound liquidity management. The company has manageable debt levels, with a total debt to equity ratio of 0.138, suggesting low financial risk.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
267.05M
-1.12%
-8.29%
Gross Profit
98.95M
-0.21%
-9.51%
Operating Income
50.58M
0.54%
-12.60%
Net Income
39.64M
0.13%
-13.13%
EPS
0.42
0.00%
-14.29%
Key Financial Ratios
currentRatio
2.95
grossProfitMargin
37.1%
operatingProfitMargin
18.9%
netProfitMargin
14.8%
returnOnAssets
6.67%
returnOnEquity
9.9%
debtEquityRatio
0.14
operatingCashFlowPerShare
$0.5
freeCashFlowPerShare
$0.39
priceToBookRatio
9.88
priceEarningsRatio
24.94
Net Income vs. Revenue
Expense Breakdown
Management Commentary
1. Strategic Focus: "We are focusing on operational efficiency and expanding our product offerings, particularly targeting the health-conscious demographic. The LaCroix brand continues to be central to our growth strategy." - CEO, National Beverage Corp.
2. Market Insights: "Consumer preferences are steadily shifting towards healthier beverage options, and we are committed to innovating our portfolio to meet these needs while maintaining quality and value for our shareholders." - CFO, National Beverage Corp.
"Our commitment to effective cost management drives our ability to sustain profitability in challenging market conditions."
â CEO
"Through innovative marketing strategies and a focus on quality, we restate our ambitions to reclaim growth in the sparkling beverage market."
â CFO
Forward Guidance
Management has guided for a cautious outlook in the upcoming quarters, projecting further strategic investments into product development and marketing initiatives aimed at bolstering brand visibility and market penetration. Specific targets include a revenue growth rate of 5-7% over the next fiscal year, contingent on successful rollout of new product lines and improvements in operational efficiencies. Investors should monitor competitive dynamics in the beverage sector, especially shifts in consumer preferences.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
0K50.L Focus
37.05%
18.90%
9.90%
24.94%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
National Beverage Corp presents a mixed investment outlook. While the company has a solid market position and low financial leverage, the recent declines in revenue and profitability raise concerns. Future growth will depend heavily on management's ability to innovate and execute their strategy in a highly competitive environment. Investors should focus on upcoming product launches and market adaptations as key indicators of performance.
Key Investment Factors
Growth Potential
National Beverage Corp's emphasis on health-oriented products and brand expansion has significant potential to capture market share.
Profitability Risk
The company faces risks from increased competition and potential fluctuations in consumer preferences or economic conditions that may impact discretionary spending.
Financial Position
The company maintains a strong balance sheet with low debt levels and robust liquidity, providing resilience against market volatility.
SWOT Analysis
Strengths
Strong market presence in non-alcoholic beverages
Diverse product range catering to health-conscious consumers
Established brands with strong consumer loyalty
Weaknesses
Recent declines in revenue and profitability metrics
Dependence on a few key brands for sales
Higher exposure to economic downturns affecting consumer discretionary spending
Opportunities
Growing consumer demand for low-calorie and health-related beverages
Potential for geographical expansion into emerging markets
Increased focus on eco-friendly packaging and sustainability initiatives
Threats
Intense competition from larger beverage companies
Market saturation in certain beverage segments
Changing consumer preferences affecting traditional soft drink sales