GURU Organic Energy Announces Second Quarter 2022 Financial Results

Montreal, Quebec, CANADA

  • Record Q2 2022 net revenue of $7.6 million, up from $7.1 million in Q2 2021
  • GURU continues to be the fastest-growing energy drink in Canada in the last 52 weeks1 and the #1 energy drink brand among adults under 25 in Quebec, the next generation of energy drink consumers2
  • 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’3
  • Strong financial position with over $62 million in cash and cash equivalents, short-term investments and unused credit facilities

Post Q2 highlights

MONTREAL, June 14, 2022 (GLOBE NEWSWIRE) -- GURU Organic Energy Corp. (TSX: GURU) (“GURU” or the “Company”), Canada’s leading organic energy drink brand, is pleased to announce its results for the second quarter ended April 30, 2022. All amounts are in Canadian dollars unless otherwise indicated.

Financial Highlights
(in thousands of dollars, except per share data)

Three months ended
April 30
Six months ended
April 30
2022 2021 2022 2021 
Net revenue7,603 7,074 14,569 13,676 
Gross profit4,126 4,435 7,923 8,532 
Net loss(3,974)(1,204)(7,163)(1,835)
Basic and diluted loss per share(0.12)(0.04)(0.22)(0.06)
Adjusted EBITDA4(3,748)(833)(6,762)(1,264)

“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%,” said 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.”

“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. 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. overall5, 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 Mr. Goyette.

Ranked a Future 50 Sustainable Company by Corporate Knights
GURU is proud to have been 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,” said Mr. Goyette.

Results of operations
Net revenue in the second quarter increased by 7% to $7.6 million, compared to $7.1 million for the same period a year ago. The increase is reflected by a 26% growth in volume overall, as a result of higher velocities, new product launches, and increased points of sale in Canada, and a new club rotational program entry in the U.S., partially offset by costs associated with the exclusive Canadian distribution agreement. For the six-month period, net revenue increased by 7% to $14.6 million, up from $13.7 million for the same period in 2021, as volume overall grew by 24%.

Gross profit totalled $4.1 million, compared to $4.4 million in Q2 2021. Gross margin was 54%, compared to 55% in Q1 2022, reflecting 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 our Canadian distribution, sales and merchandising model, effective as of Q4 2021, and comprises distribution, selling and merchandizing fees (a portion of which was previously categorized as SG&A expenses). Gross margin was also slightly impacted by higher product costs driven by inflationary pressures on input and transportation costs.

Selling, general and administrative expenses (“SG&A”), which include operational, sales, marketing, and administration costs, amounted to $8.2 million in the second quarter, compared to SG&A of $5.5 million for the same period a year ago. Selling and marketing expenses accounted for more than 70% of the increase in SG&A as the Company invested in targeted sales and marketing campaigns during the quarter, notably its ‘Made in Plants’ marketing campaign, the launch of GURU Guayusa Tropical Punch across Canada, the launch of the 500 ml format in Quebec and the listing of the 355 ml 4-pack across Canada, as well as continued trade marketing investments in the U.S. For the six-month period, SG&A amounted to $15.3 million, compared to $10.2 million a year ago.

Adjusted EBITDA3 amounted to $(3.7) million compared to $(0.8) million last year. The decrease in adjusted EBITDA was mainly due to higher selling and marketing expenses, and to a lesser extent, to lower gross margins.

Net loss for the first quarter totalled $4.0 million or $(0.12) per share (basic and diluted), compared to a net loss of $1.2 million or $(0.04) per share (basic and diluted) for the same period a year ago. The increase in net loss reflects the lower margins and the additional costs associated with brand, field and trade marketing activities.

As of April 30, 2022, the Company had cash, cash equivalents and short-term investments of $52.8 million and unused $CA and $US denominated credit facilities totalling $10 million.

1 Nielsen: Last 52-week period ending April 23, 2022 - All Channels, Canada.
2 Market Research conducted by element54 and Patterson Langlois for GURU in June 2021 with 1,500 participants in the province of Quebec.
3 Nielsen: Last 52-week period ending April 23, 2022 - Convenience and Gas (C&G) channel, Quebec.
4 Please refer to the “Non-GAAP financial measure” section for additional information on reconciliation of net loss to adjusted EBITDA at the end of this release.
5 SPINS IRI data, Total Multi-Outlet (MULO) channels, period ending March 20, 2022.

Conference call
GURU will hold a conference call to discuss its second quarter 2022 results today, June 14, 2022, at 10:00 a.m. ET. Interested parties can listen in by accessing the live audio webcast at or by dialling 833-678-0822 (North America) or 602-563-8278 (International). Participants will need to provide the following Conference ID Number: 1207028. A webcast replay will be available on GURU’s website until June 14, 2023.

About GURU Products
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 – and the best thing is their amazing taste.

About GURU
GURU Organic Energy Corp. (TSX: GURU) is a dynamic, fast-growing beverage company launched in 1999, when it pioneered the world’s first natural, plant-based energy drink. The Company markets organic energy drinks in Canada and the United States through an estimated distribution network of over 25,000 points of sale, and through and Amazon. GURU has built an inspiring brand with a clean list of organic plant-based ingredients. Its drinks offer consumers good energy that never comes at the expense of their health. The Company is committed to achieving its mission of cleaning the energy drink industry in Canada and the United States. For more information, go to or follow us @guruenergydrink on Instagram and @guruenergy on Facebook.

For further information, please contact:

GURU Organic Energy 
Carl Goyette, President and CEO
Ingy Sarraf, Chief Financial Officer
Lyla Radmanovich

Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of applicable Canadian securities legislation. Such forward-looking statements include, but are not limited to, information with respect to our objectives and the strategies for achieving those objectives, as well as information with respect to our beliefs, plans, expectations, anticipations, estimates and intentions. Forward-looking statements are typically identified by the use of words such as “may”, “would”, “should”, “could”, “expect”, “intend”, “estimate”, “anticipate”, “plan”, “foresee”, “believe”, or “continue”, although not all forward-looking statements contain these words. Forward-looking statements are provided for the purposes of assisting the reader in understanding the Company and its business, operations, prospects, and risks at a point in time in the context of historical and possible future developments, and the reader is therefore cautioned that such information may not be appropriate for other purposes. Forward-looking statements are based on assumptions and are subject to a number of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking statements. Those risks and uncertainties include the following, which are discussed in greater detail under “Risk Factors” in the Company’s Annual Information Form for the year ended October 31, 2021, available on SEDAR at management of growth; reliance on key personnel; changes in consumer preferences; significant changes in government regulation; criticism of energy drink products and/or the energy drink market; economic downturn and continued uncertainty in the financial markets and other adverse changes in general economic or political conditions, as well as the COVID-19 pandemic or other major macroeconomic phenomena; global or regional catastrophic events; fluctuations in foreign currency exchange rates; net revenues derived entirely from energy drinks; increased competition; relationships with co-packers and distributors and/or their ability to manufacture and/or distribute GURU’s products; relationships with existing customers; changing retail landscape; increases in costs and/or shortages of raw materials and/or ingredients and/or fuel and/or costs of co-packing; failure to accurately estimate demand for its products; history of negative cash flow and no assurance of continued profitability or positive EBITDA; intellectual property rights; maintenance of brand image or product quality; retention of the full-time services of senior management; climate change; litigation; information technology systems; fluctuation of quarterly operating results; risks associated with the PepsiCo distribution agreement; no assurance of continued profitability or positive EBITDA; and conflicts of interest. Certain assumptions were made in preparing the forward-looking statements concerning availability of capital resources, business performance, market conditions and consumer demand. Consequently, all of the forward-looking statements contained herein are qualified by the foregoing cautionary statements, and there can be no guarantee that the results or developments that we anticipate will be realized or, even if substantially realized, that they will have the expected consequences or effects on our business, financial condition, or results of operation. Unless otherwise noted or the context otherwise indicates, the forward-looking statements contained herein are provided as of the date hereof, and we do not undertake to update or amend such forward-looking statements whether as a result of new information, future events or otherwise, except as may be required by applicable law.

Non-GAAP Financial Measure

Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure. Adjusted EBITDA is defined as net income or loss before national Canadian distribution agreement set-up costs, reverse acquisition of Mira X expenses, income taxes, net financial expenses, depreciation and amortization, and stock-based compensation expense. The exclusion of national Canadian distribution agreement set-up costs eliminates the impact on earnings of costs that are not expected to re-occur in the near term. The exclusion of net finance expense eliminates the impact on earnings derived from non-operational activities, and the exclusion of depreciation, amortization, and share-based compensation eliminates the non-cash impact of these items. We believe that adjusted EBITDA is a useful measure of financial performance without the variation caused by the impacts of the items described above because it provides an indication of the Company’s ability to seize growth opportunities in a cost-effective manner, finance its ongoing operations and service its long-term debt. Excluding these items does not imply that they are necessarily non-recurring. Management believes this non-GAAP financial measure, in addition to conventional measures prepared in accordance with IFRS, enable investors to evaluate the Company’s operating results, underlying performance and future prospects in a manner similar to management. Although Adjusted EBITDA is frequently used by securities analysts, lenders and others in their evaluation of companies, it has limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of the Company’s results as reported under IFRS. This non-GAAP financial measure is not an earnings or cash flow measure recognized by International Financial Reporting Standards (IFRS) and does not have a standardized meaning prescribed by IFRS. Our method of calculating this financial measure may differ from the methods used by other issuers and, accordingly, our definition of this non-GAAP financial measure may not be comparable to similar measures presented by other issuers. Investors are cautioned that non-GAAP financial measures should not be construed as an alternative to net income determined in accordance with IFRS as indicators of our performance or to cash flows from operating activities as measures of liquidity and cash flows.

Reconciliation of Net Loss to Adjusted EBITDA


Three-month periods endedSix-month periods ended
April 30, 2022 April 30, 2021 April 30, 2022 April 30, 2021 
(In thousands of Canadian dollars)$ $ $ $ 
Net loss(3,974)(1,204)(7,163)(1,835)
Reverse acquisition of Mira X expenses- 85 - 110 
Net financial (income) expenses(113)75 (227)103 
Depreciation and amortization218 110 409 190 
Income taxes19 (51)39 (56)
Stock-based compensation expense102 152 180 224 
Adjusted EBITDA(3,748)(833)(6,762)(1,264)