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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of Report (Date of earliest event reported): November 9, 2023
REED’S,
INC.
(Exact
name of registrant as specified in its charter)
Delaware |
|
001-32501 |
|
35-2177773 |
(State
or other jurisdiction
of
incorporation) |
|
(Commission
File
Number) |
|
(IRS
Employer
Identification
No.) |
201
Merritt 7 Corporate Park, Norwalk, CT 06851
(Address
of principal executive offices and zip code)
Not
applicable
(Former
name or former address if changed since last report)
Registrant’s
telephone number, including area code: (310) 217-9400
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
☐ |
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
|
☐ |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
☐ |
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act: None
Title
of Each Class |
|
Trading
Symbol(s) |
|
Name
of Each Exchanged on Which Registered |
|
|
|
|
|
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405)
or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging
growth company ☐
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item
2.02 Results of Operations and Financial Condition.
On
November 9, 2023, Reed’s, Inc., a Delaware corporation (the “company” or “Reed’s”) issued
a press release announcing financial results for the third quarter ended September 30, 2023. The full text of the press release issued
in connection with the announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
Reed’s will conduct a conference call tomorrow, November 10, 2023, at 8:30 a.m. Eastern time to discuss its results for the
three months ended September 30, 2023.
Reed’s
management will host the conference call, followed by a question-and-answer period.
Date:
Friday, November 10, 2023
Time:
8:30 a.m. Eastern time
Toll-free
dial-in number: (844) 850-0544
International
dial-in number: (412) 542-4115
Conference
ID: 10184105
Webcast:
Reed’s Q3 2023 Conference Call
Please
dial into the conference call 5-10 minutes prior to the start time. An operator will register your name and organization. If you have
any difficulty connecting with the conference call, please contact the company’s investor relations team at (720) 330-2829.
The
conference call will also be broadcast live and available for replay on the investor relations section of the Company’s website
at https://investor.reedsinc.com.
Item 7.01. Regulation FD Disclosure.
See
“Item 2.02 Results of Operations and Financial Condition” above.
The
information in this Current Report on Form 8-K under Items 2.02 and 7.01, including the information contained in Exhibit 99.1, is being
furnished to the Securities and Exchange Commission, and shall not be deemed to be “filed” for the purposes of Section 18
of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, and shall not be deemed to be incorporated
by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except as shall be expressly set
forth by a specific reference in such filing.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits.
The
following exhibit is furnished with this Current Report on Form 8-K:
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
|
REEDS,
INC., |
|
a
Delaware corporation |
|
|
|
Dated:
November 9, 2023 |
By:
|
/s/
Norman E. Snyder, Jr. |
|
|
Norman
E. Snyder, Jr. |
|
|
Chief
Executive Officer |
Exhibit
99.1
Reed’s
Reports Third Quarter 2023 Results
Gross
Margin Expansion and Continued Operating Expense Reductions Lead to First Quarter of Modified EBITDA Profitability Since 2016
and
Operating Loss improvement to $0.1 million
Norwalk,
CT, (November 9, 2023) – Reed’s, Inc. (OTCQX: REED) (“Reed’s” or the “Company”), owner
of the nation’s leading portfolio of handcrafted, natural ginger beverages, is reporting financial results for the three months
ended September 30, 2023.
Q3
2023 Financial Highlights (vs. Q3 2022):
|
● |
Net
sales were $11.9 million compared to $12.1 million. |
|
● |
Gross
profit increased 66% to $4.0 million compared to $2.4 million, with gross margin up 1,390 basis points to 34.0% compared to 20.1%. |
|
● |
Delivery
and handling costs were reduced by 15% to $2.98 per case. |
|
● |
Selling,
general and administrative expenses were reduced by 14% to $2.3 million. |
|
● |
Operating
loss improved to $0.1 million compared to $2.5 million. |
|
● |
Modified
EBITDA improved to $0.2 million compared to $(2.2) million |
Management
Commentary
“I
am pleased with the progress we made in the third quarter as we continued to lower input costs and freight expenses, enabling us to materially
expand gross margin and reach our guidance of turning modified EBITDA profitable,” said Norman E. Snyder, CEO of Reed’s.
“We also achieved our guidance of realizing $6 million in annual operating expense reductions, which reflects our prudent cost
management across multiple areas of the business. Although we considerably improved profitability, net sales were impacted by a delay
in our seasonal programs which will be recognized in the fourth quarter, as well as short order shipments. We have made progress on reducing
short shipments by building up our inventory levels and expect to capitalize on strong seasonal demand in the months ahead.
“Given
the inventory challenges, we are revising our net sales guidance for 2023 to range between $45 and $47 million, however we expect to
maintain our modified EBITDA profitability and exceed our guidance of realizing $6 million of operating expense reductions for the year.
With ongoing efforts to bolster inventory levels, an optimized cost structure, and continued strong demand for Reed’s products,
we are well positioned to deliver on our near-term objectives.”
Third
Quarter 2023 Financial Results
During
the third quarter of 2023, net sales were $11.9 million compared to $12.1 million in the year-ago period. The decrease was primarily
driven by delayed seasonal shipments and, to a lesser extent, short order shipments. Reed’s expects to recognize the delayed seasonal
shipments in the fourth quarter of 2023.
Gross
profit for the third quarter of 2023 increased 66% to $4.0 million compared to $2.4 million in the same period of 2022. Gross margin
increased 1,390 basis points to 34.0% compared to 20.1% in the year-ago quarter. The increase was primarily driven by lower supply chain
and input costs.
Delivery
and handling costs were reduced by 15% to $1.9 million during the third quarter of 2023 compared to $2.2 million in the third quarter
of 2022. The decrease was primarily driven by renegotiated freight contracts, improved throughput, as well as the Company’s streamlined
distribution orbit model. Delivery and handling costs were reduced to 16% of net sales or $2.98 per case, compared to 19% of net sales
or $3.38 per case during the same period last year.
Selling,
general and administrative costs declined by 14% to $2.3 million during the third quarter of 2023 compared to $2.6 million in the year-ago
quarter. As a percentage of net sales, selling, general and administrative costs were reduced to 19% compared to 22%.
Operating
loss during the third quarter of 2023 improved to $0.1 million or $(0.03) per share, compared to $2.5 million or $(1.09) per share in
the third quarter of 2022.
Modified
EBITDA improved to $0.2 million in the third quarter of 2023 compared to $(2.2) million in the third quarter of 2022.
Liquidity
and Cash Flow
For
the third quarter of 2023, cash used in operations was $1.8 million compared to $0.2 million for the same period in 2022. The increase
in cash used was primarily driven by higher inventory purchases compared to the year-ago period.
As
of September 30, 2023, the Company had approximately $1.0 million of cash and $26.8 million of total debt net of capitalized financing
fees. The debt includes $17.1 million from a convertible note and $9.7 million from the Company’s revolving line of credit, which
has $3.1 million of additional borrowing capacity.
FY
2023 Financial Outlook
Based
on the inventory shortage faced year-to-date, the Company is revising its net sales guidance to range between $45 million and $47 million
for 2023 and now expects to turn cash flow positive in 2024 as the Company utilizes its cash to increase inventory in the fourth quarter.
However, the Company expects to maintain its modified EBITDA profitability and exceed its guidance of realizing $6 million of operating
expense reductions for the year.
Conference
Call
The
Company will conduct a conference call tomorrow, November 10, 2023, at 8:30 a.m. Eastern time to discuss its results for the three months
ended September 30, 2023.
Reed’s
management will host the conference call, followed by a question-and-answer period.
Date:
Friday, November 10, 2023
Time:
8:30 a.m. Eastern time
Toll-free
dial-in number: (844) 850-0544
International
dial-in number: (412) 542-4115
Conference
ID: 10184105
Webcast:
Reed’s Q3 2023 Conference Call
Please
dial into the conference call 5-10 minutes prior to the start time. An operator will register your name and organization. If you have
any difficulty connecting with the conference call, please contact the company’s investor relations team at (720) 330-2829.
The
conference call will also be broadcast live and available for replay on the investor relations section of the Company’s website
at https://investor.reedsinc.com.
About
Reed’s, Inc.
Reed’s
is an innovative company and category leader that provides the world with high quality, premium and naturally bold™ better-for-you
beverages. Established in 1989, Reed’s is a leader in craft beverages under the Reed’s®, Virgil’s® and Flying
Cauldron® brand names. The Company’s beverages are now sold in over 45,000 stores nationwide.
Reed’s
is known as America’s #1 name in natural, ginger-based beverages. Crafted using real ginger and premium ingredients, Reed’s
portfolio includes ginger beers, ginger ales, ready-to-drink ginger mules and hard ginger ales. The brand has recently successfully expanded
into the zero-sugar segment with its proprietary, natural sweetener system.
Virgil’s®
is an award-winning line of craft sodas, made with the finest natural ingredients and without GMOs or artificial preservatives. The brand
offers an array of great tasting, bold flavored sodas including Root Beer, Vanilla Cream, Black Cherry, Orange Cream, and more. These
flavors are also available in nine zero sugar varieties which are naturally sweetened and certified ketogenic.
Flying
Cauldron® is a non-alcoholic butterscotch beer prized for its creamy vanilla and butterscotch flavors. Sought after by beverage aficionados,
Flying Cauldron is made with natural ingredients and no artificial flavors, sweeteners, preservatives, gluten, caffeine, or GMOs.
For
more information, visit drinkreeds.com, virgils.com and flyingcauldron.com. To receive exclusive perks for Reed’s
investors, please visit the Company’s page on the Stockperks app here.
Forward-Looking
Statements
Statements
in this release that are not historical are forward-looking statements made pursuant to the safe harbor provisions of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements
are typically identified by terms such as “estimate,” “expect,” “intend,” “project,”
“will,” “plan,” and similar expressions. These forward-looking statements are based on current expectations and
include our management’s expectations and guidance for fiscal year 2023 under the heading “FY 2023 Financial Outlook”.
The achievement or success of the matters covered by such forward-looking statements involves risks, uncertainties, and assumptions,
many of which involve factors or circumstances that are beyond our control. Reed’s 2023 guidance reflects year-to-date and expected
future business trends and includes impacts of the inventory shortage as of the date hereof. New supply chain challenges that may develop
and further potential inflation cannot be reasonably estimated and are not factored into current fiscal 2023 guidance. These risks could
materially impact our ability to access raw materials, production, transportation and/or other logistics needs.
Financial
guidance should not be viewed as a substitute for full financial statements prepared in accordance with GAAP.
If
any such risks or uncertainties materialize or if any of the assumptions prove incorrect, Reed’s actual results could differ materially
from the results expressed or implied by the forward-looking statements we make, including our ability to achieve our targets for the
fiscal year ending December 31, 2023. The risks and uncertainties referred to above include, but are not limited to: inventory shortages;
risks associated with new product releases; the impacts of further inflation; risks that customer demand may fluctuate or decrease; risks
that we are unable to collect unbilled contractual commitments, particularly in the current economic environment; our ability to compete
successfully and manage growth; our significant debt obligations; our ability to develop and expand strategic and third party distribution
channels; our dependence on third party suppliers, brewers and distributors; third party co-packers meeting contractual commitments;
risks related to our international operations; our ability to continue to innovate; our strategy of making investments in sales to drive
growth; increasing costs of fuel and freight, protection of intellectual property; competition; general political or destabilizing events,
including the wars in Ukraine and Israel, conflict or acts of terrorism; financial markets, commodity and currency impacts of the wars;
the effect of evolving domestic and foreign government regulations, including those addressing data privacy and cross-border data transfers;
and other risks detailed from time to time in Reed’s public filings, including Reed’s annual report on Form 10-K filed on
May 15, 2023 and its Quarterly Report on Form 10Q, expected to be filed on November 10, 2023, which are (or will be) available on the
Securities and Exchange Commission’s web site at www.sec.gov. These forward-looking statements are based on current expectations
and speak only as of the date hereof. Reed’s assumes no obligation and does not intend to update these forward-looking statements,
except as required by law.
Investor
Relations Contact
Sean
Mansouri, CFA
Elevate
IR
ir@reedsinc.com
(720)
330-2829
REED’S,
INC.
CONDENSED
STATEMENTS OF OPERATIONS
For
the Three and Nine Months Ended September 30, 2023 and 2022
(Unaudited)
(Amounts
in thousands, except share and per share amounts)
| |
Three Months Ended | | |
Nine Months Ended | |
| |
September 30, | | |
September 30, | |
| |
2023 | | |
2022 | | |
2023 | | |
2022 | |
| |
| | |
| | |
| | |
| |
Net Sales | |
$ | 11,856 | | |
$ | 12,094 | | |
$ | 33,018 | | |
$ | 38,001 | |
Cost of goods sold | |
| 7,823 | | |
| 9,659 | | |
| 23,778 | | |
| 29,335 | |
Gross profit | |
| 4,033 | | |
| 2,435 | | |
| 9,240 | | |
| 8,666 | |
| |
| | | |
| | | |
| | | |
| | |
Operating expenses: | |
| | | |
| | | |
| | | |
| | |
Delivery and handling expense | |
| 1,908 | | |
| 2,249 | | |
| 5,714 | | |
| 8,893 | |
Selling and marketing expense | |
| 861 | | |
| 1,220 | | |
| 3,567 | | |
| 5,623 | |
General and administrative expense | |
| 1,407 | | |
| 1,420 | | |
| 4,427 | | |
| 5,319 | |
Total operating expenses | |
| 4,176 | | |
| 4,889 | | |
| 13,708 | | |
| 19,835 | |
| |
| | | |
| | | |
| | | |
| | |
Loss from operations | |
| (143 | ) | |
| (2,454 | ) | |
| (4,468 | ) | |
| (11,169 | ) |
| |
| | | |
| | | |
| | | |
| | |
Interest expense | |
| (1,293 | ) | |
| (777 | ) | |
| (4,459 | ) | |
| (2,119 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net loss | |
| (1,436 | ) | |
| (3,231 | ) | |
| (8,927 | ) | |
| (13,288 | ) |
| |
| | | |
| | | |
| | | |
| | |
Dividends on Series A Convertible Preferred Stock | |
| - | | |
| - | | |
| (5 | ) | |
| (5 | ) |
| |
| | | |
| | | |
| | | |
| | |
Net Loss Attributable to Common Stockholders | |
$ | (1,436 | ) | |
$ | (3,231 | ) | |
$ | (8,932 | ) | |
$ | (13,293 | ) |
| |
| | | |
| | | |
| | | |
| | |
Loss per share – basic and diluted | |
$ | (0.34 | ) | |
$ | (1.43 | ) | |
$ | (2.69 | ) | |
$ | (6.54 | ) |
| |
| | | |
| | | |
| | | |
| | |
Weighted average number of shares outstanding – basic and diluted | |
| 4,169,131 | | |
| 2,254,356 | | |
| 3,322,959 | | |
| 2,030,503 | |
REED’S,
INC,
CONDENSED
BALANCE SHEETS
(Amounts
in thousands, except share amounts)
| |
September 30, | | |
December 31, | |
| |
2023 | | |
2022 | |
| |
(Unaudited) | | |
| |
ASSETS | |
| | | |
| | |
Current assets: | |
| | | |
| | |
Cash | |
$ | 1,004 | | |
$ | 533 | |
Accounts receivable, net of allowance of $514 and $252, respectively | |
| 5,267 | | |
| 5,671 | |
Inventory, net | |
| 15,964 | | |
| 16,175 | |
Receivable from former related party | |
| 777 | | |
| 777 | |
Prepaid expenses and other current assets | |
| 489 | | |
| 939 | |
Total current assets | |
| 23,501 | | |
| 24,095 | |
| |
| | | |
| | |
Property and equipment, net of accumulated depreciation of $1,001 and $787, respectively | |
| 559 | | |
| 766 | |
Intangible assets | |
| 627 | | |
| 626 | |
Total assets | |
$ | 24,687 | | |
$ | 25,487 | |
| |
| | | |
| | |
LIABILITIES AND STOCKHOLDERS’ DEFICIT | |
| | | |
| | |
Current liabilities: | |
| | | |
| | |
Accounts payable | |
$ | 9,067 | | |
$ | 9,805 | |
Accrued expenses | |
| 873 | | |
| 233 | |
Revolving line of credit, net of capitalized financing costs of $242 and $363, respectively | |
| 9,697 | | |
| 10,974 | |
Convertible notes payable, current portion, net of debt discount of $0 and $414, respectively | |
| 7,380 | | |
| 2,434 | |
Payable to former related party | |
| 452 | | |
| 2,025 | |
Current portion of lease liabilities | |
| 209 | | |
| 187 | |
Total current liabilities | |
| 27,678 | | |
| 25,658 | |
| |
| | | |
| | |
Convertible note payable, net of debt discount of $252 and $562, respectively, less current portion | |
| 9,721 | | |
| 8,092 | |
Lease liabilities, less current portion | |
| 48 | | |
| 207 | |
Total liabilities | |
| 37,447 | | |
| 33,957 | |
| |
| | | |
| | |
Stockholders’ deficit: | |
| | | |
| | |
Series A Convertible Preferred stock, $10 par value, 500,000 shares authorized, 9,411 shares issued and outstanding | |
| 94 | | |
| 94 | |
Common stock, $.0001 par value, 180,000,000 shares authorized; 4,169,131 and 2,519,485 shares issued and outstanding, respectively | |
| - | | |
| - | |
Additional paid in capital | |
| 119,277 | | |
| 114,635 | |
Accumulated deficit | |
| (132,131 | ) | |
| (123,199 | ) |
Total stockholders’ deficit | |
| (12,760 | ) | |
| (8,470 | ) |
Total liabilities and stockholders’ deficit | |
$ | 24,687 | | |
$ | 25,487 | |
REED’S,
INC.
CONDENSED
STATEMENTS OF CASH FLOWS
For
the Nine Months Ended September 30, 2023 and 2022
(Unaudited)
(Amounts
in thousands)
| |
September 30, | | |
September 30, | |
| |
2023 | | |
2022 | |
Cash flows from operating activities: | |
| | | |
| | |
Net loss | |
$ | (8,927 | ) | |
$ | (13,288 | ) |
Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | |
Depreciation | |
| 112 | | |
| 79 | |
Loss on disposal of property and equipment | |
| 9 | | |
| - | |
Amortization of debt discount | |
| 958 | | |
| 307 | |
Amortization of prepaid financing costs | |
| - | | |
| 431 | |
Fair value of vested options | |
| 351 | | |
| 448 | |
Fair value of vested restricted shares granted to officers | |
| 3 | | |
| 137 | |
Fair value of common shares issued as financing costs | |
| - | | |
| 37 | |
Change in allowance for doubtful accounts | |
| 262 | | |
| (152 | ) |
Inventory write-downs | |
| (205 | ) | |
| 35 | |
Accrued interest | |
| 2,483 | | |
| 386 | |
Changes in operating assets and liabilities: | |
| | | |
| | |
Accounts receivable | |
| 142 | | |
| (673 | ) |
Inventory | |
| 417 | | |
| (2,901 | ) |
Prepaid expenses and other assets | |
| 450 | | |
| (399 | ) |
Decrease in right of use assets | |
| 102 | | |
| 86 | |
Accounts payable | |
| (738 | ) | |
| (860 | ) |
Accrued expenses | |
| 639 | | |
| (62 | ) |
Accrued dividend | |
| (5 | ) | |
| - | |
Lease liabilities | |
| (137 | ) | |
| (118 | ) |
Net cash used in operating activities | |
| (4,084 | ) | |
| (16,507 | ) |
| |
| | | |
| | |
Cash flows from investing activities: | |
| | | |
| | |
Trademark costs | |
| (1 | ) | |
| (2 | ) |
Purchase of property and equipment | |
| (84 | ) | |
| | |
Proceeds from sale of property and equipment | |
| 68 | | |
| - | |
Net cash used in investing activities | |
| (17 | ) | |
| (2 | ) |
| |
| | | |
| | |
Cash flows from financing activities: | |
| | | |
| | |
Proceeds from line of credit | |
| 32,686 | | |
| 40,576 | |
Payments on line of credit | |
| (34,085 | ) | |
| (41,299 | ) |
Payments of debt issuance costs | |
| - | | |
| (483 | ) |
Proceeds from sale of common stock | |
| 4,016 | | |
| 5,034 | |
Proceeds from convertible note payable, net of expenses | |
| 3,797 | | |
| 12,430 | |
Payment of convertible note payable | |
| (268 | ) | |
| (400 | ) |
Repurchase of common stock | |
| (1 | ) | |
| (2 | ) |
Amounts from former related party, net | |
| (1,573 | ) | |
| 629 | |
Net cash provided by financing activities | |
| 4,572 | | |
| 16,485 | |
| |
| | | |
| | |
Net increase (decrease) in cash | |
| 471 | | |
| (24 | ) |
Cash at beginning of period | |
| 533 | | |
| 49 | |
Cash at end of period | |
$ | 1,004 | | |
$ | 25 | |
| |
| | | |
| | |
Supplemental disclosures of cash flow information: | |
| | | |
| | |
Cash paid for interest | |
$ | 548 | | |
$ | 1,051 | |
| |
| | | |
| | |
Non -cash investing and financing activities | |
| | | |
| | |
Dividends on Series A Convertible Preferred Stock | |
$ | 5 | | |
$ | 5 | |
Modified
EBITDA
In
addition to our GAAP results, we present Modified EBITDA as a supplemental measure of our performance. However, Modified
EBITDA is not a recognized measurement under GAAP and should not be considered as an alternative to net income, income from
operations or any other performance measure derived in accordance with GAAP, or as an alternative to cash flow from operating
activities as a measure of liquidity. We define Modified EBITDA as net income (loss), plus, interest expense, depreciation and
amortization, stock-based compensation, changes in fair value of warrant expense, and one-time restructuring-related costs including
employee severance and asset impairment.
Management
considers our core operating performance to be that which our managers can affect in any particular period through their management
of the resources that affect our underlying revenue and profit generating operations during that period. Non-GAAP adjustments
to our results prepared in accordance with GAAP are itemized below. You are encouraged to evaluate these adjustments and the reasons
we consider them appropriate for supplemental analysis. In evaluating Modified EBITDA, you should be aware that in the future we may
incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of Modified EBITDA
should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
Set
forth below is a reconciliation of net loss to Modified EBITDA for the three months ended September 30, 2023, and 2022 (unaudited; in
thousands):
| |
Three Months Ended | |
|
|
September 30 | |
| |
2023 | | |
2022 | |
Net loss | |
$ | (1,436 | ) | |
$ | (3,231 | ) |
| |
| | | |
| | |
Modified EBITDA adjustments: | |
| | | |
| | |
Depreciation and amortization | |
| 68 | | |
| 58 | |
Interest expense | |
| 1,293 | | |
| 777 | |
Stock option and other noncash compensation | |
| 139 | | |
| 214 | |
Severance | |
| 85 | | |
| - | |
Legal settlements | |
| 12 | | |
| - | |
Total EBITDA adjustments | |
$ | 1,597 | | |
$ | 1,049 | |
| |
| | | |
| | |
Modified EBITDA | |
$ | 161 | | |
$ | (2,182 | ) |
We present Modified EBITDA because we believe it assists investors and analysts in comparing our performance across reporting periods
on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. In addition, we use
Modified EBITDA in developing our internal budgets, forecasts, and strategic plan; in analyzing the effectiveness of our business strategies
in evaluating potential acquisitions; making compensation decisions; and in communications with our board of directors concerning our
financial performance. Modified EBITDA has limitations as an analytical tool, which includes, among others, the following:
|
● |
Modified
EBITDA does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments; |
|
● |
Modified
EBITDA does not reflect changes in, or cash requirements for, our working capital needs; |
|
● |
Modified
EBITDA does not reflect future interest expense, or the cash requirements necessary to service interest or principal payments, on
our debts; and |
|
● |
Although
depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in
the future, and Modified EBITDA does not reflect any cash requirements for such replacements. |
v3.23.3
Cover
|
Nov. 09, 2023 |
Entity Addresses [Line Items] |
|
Document Type |
8-K
|
Amendment Flag |
false
|
Document Period End Date |
Nov. 09, 2023
|
Entity File Number |
001-32501
|
Entity Registrant Name |
REED’S,
INC.
|
Entity Central Index Key |
0001140215
|
Entity Tax Identification Number |
35-2177773
|
Entity Incorporation, State or Country Code |
DE
|
Entity Address, Address Line One |
201
Merritt 7 Corporate Park
|
Entity Address, City or Town |
Norwalk
|
Entity Address, State or Province |
CT
|
Entity Address, Postal Zip Code |
06851
|
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(310)
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217-9400
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Merritt 7 Corporate Park
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Norwalk
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CT
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