Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Jul. 31, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Transition Report | false | |
Entity File Number | 001-18761 | |
Entity Registrant Name | MONSTER BEVERAGE CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-1809393 | |
Entity Address, Address Line One | 1 Monster Way | |
Entity Address, City or Town | Corona | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92879 | |
City Area Code | 951 | |
Local Phone Number | 739 - 6200 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | MNST | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,047,518,325 | |
Entity Central Index Key | 0000865752 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 1,869,774 | $ 1,307,141 |
Short-term investments | 1,417,239 | 1,362,314 |
Accounts receivable, net | 1,333,004 | 1,016,203 |
Inventories | 846,812 | 935,631 |
Prepaid expenses and other current assets | 148,750 | 109,823 |
Prepaid income taxes | 38,534 | 33,785 |
Total current assets | 5,654,113 | 4,764,897 |
INVESTMENTS | 62,248 | 61,443 |
PROPERTY AND EQUIPMENT, net | 576,645 | 516,897 |
DEFERRED INCOME TAXES, net | 177,039 | 177,039 |
GOODWILL | 1,417,941 | 1,417,941 |
OTHER INTANGIBLE ASSETS, net | 1,224,100 | 1,220,410 |
OTHER ASSETS | 151,252 | 134,478 |
Total Assets | 9,263,338 | 8,293,105 |
CURRENT LIABILITIES: | ||
Accounts payable | 568,613 | 444,265 |
Accrued liabilities | 198,656 | 172,991 |
Accrued promotional allowances | 283,647 | 255,631 |
Deferred revenue | 42,765 | 43,311 |
Accrued compensation | 56,195 | 72,463 |
Income taxes payable | 12,704 | 13,317 |
Total current liabilities | 1,162,580 | 1,001,978 |
DEFERRED REVENUE | 215,039 | 223,800 |
OTHER LIABILITIES | 44,255 | 42,286 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS' EQUITY: | ||
Common stock - $0.005 par value; 5,000,000 shares authorized; 1,118,269 shares issued and 1,047,485 shares outstanding as of June 30, 2023; 1,283,688 shares issued and 1,044,600 shares outstanding as of December 31, 2022 | 5,591 | 6,418 |
Additional paid-in capital | 4,869,791 | 4,776,804 |
Retained earnings | 5,120,063 | 9,001,173 |
Accumulated other comprehensive loss | (155,725) | (159,073) |
Common stock in treasury, at cost; 70,784 shares and 239,088 shares as of June 30, 2023 and December 31, 2022, respectively | (1,998,256) | (6,600,281) |
Total stockholders' equity | 7,841,464 | 7,025,041 |
Total Liabilities and Stockholders' Equity | $ 9,263,338 | $ 8,293,105 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Common stock, shares authorized | 5,000,000 | 5,000,000 |
Common stock, shares issued | 1,118,269 | 1,283,688 |
Common stock, shares outstanding | 1,047,485 | 1,044,600 |
Common stock in treasury, shares | 70,784 | 239,088 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||
NET SALES | $ 1,854,961 | $ 1,655,260 | $ 3,553,891 | $ 3,173,833 |
COST OF SALES | 880,739 | 875,399 | 1,681,820 | 1,617,306 |
GROSS PROFIT | 974,222 | 779,861 | 1,872,071 | 1,556,527 |
OPERATING EXPENSES | 450,417 | 406,910 | 863,201 | 784,088 |
OPERATING INCOME | 523,805 | 372,951 | 1,008,870 | 772,439 |
INTEREST and OTHER INCOME (EXPENSE), net | 15,159 | (6,781) | 27,653 | (14,080) |
INCOME BEFORE PROVISION FOR INCOME TAXES | 538,964 | 366,170 | 1,036,523 | 758,359 |
PROVISION FOR INCOME TAXES | 125,093 | 92,810 | 225,208 | 190,796 |
NET INCOME | $ 413,871 | $ 273,360 | $ 811,315 | $ 567,563 |
NET INCOME PER COMMON SHARE: | ||||
Basic | $ 0.40 | $ 0.26 | $ 0.78 | $ 0.54 |
Diluted | $ 0.39 | $ 0.26 | $ 0.77 | $ 0.53 |
WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK AND COMMON STOCK EQUIVALENTS: | ||||
Basic | 1,047,065 | 1,057,233 | 1,045,993 | 1,058,017 |
Diluted | 1,060,093 | 1,069,622 | 1,059,667 | 1,070,418 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Net income, as reported | $ 413,871 | $ 273,360 | $ 811,315 | $ 567,563 |
Other comprehensive income (loss): | ||||
Change in foreign currency translation adjustment | (5,775) | (79,707) | 2,206 | (78,628) |
Available-for-sale investments: | ||||
Change in net unrealized gains (losses) | (773) | (1,105) | 2,408 | (5,164) |
Net losses on commodity derivatives | (1,266) | 0 | (1,266) | 0 |
Other comprehensive income (loss) | (7,814) | (80,812) | 3,348 | (83,792) |
Comprehensive income | $ 406,057 | $ 192,548 | $ 814,663 | $ 483,771 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income | Treasury stock | Total |
Balance at Dec. 31, 2021 | $ 6,400 | $ 4,649,420 | $ 7,809,549 | $ (69,165) | $ (5,829,253) | $ 6,566,951 |
Balance (in shares) at Dec. 31, 2021 | 1,280,086 | (221,440) | ||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | ||||||
Stock-based compensation | 16,175 | 16,175 | ||||
Stock options/awards | $ 6 | 4,504 | 4,510 | |||
Stock options/awards (in shares) | 970 | |||||
Unrealized gain (loss), net on available-for-sale securities | (4,059) | (4,059) | ||||
Repurchase of common stock | $ (12,187) | (12,187) | ||||
Repurchase of common stock (in shares) | (332) | |||||
Foreign currency translation | 1,079 | 1,079 | ||||
Net income | 294,203 | 294,203 | ||||
Balance at Mar. 31, 2022 | $ 6,406 | 4,670,099 | 8,103,752 | (72,145) | $ (5,841,440) | 6,866,672 |
Balance (in shares) at Mar. 31, 2022 | 1,281,056 | (221,772) | ||||
Balance at Dec. 31, 2021 | $ 6,400 | 4,649,420 | 7,809,549 | (69,165) | $ (5,829,253) | 6,566,951 |
Balance (in shares) at Dec. 31, 2021 | 1,280,086 | (221,440) | ||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | ||||||
Unrealized gain (loss), net on available-for-sale securities | (5,164) | |||||
Net losses on commodity derivatives | 0 | |||||
Net income | 567,563 | |||||
Balance at Jun. 30, 2022 | $ 6,410 | 4,704,364 | 8,377,112 | (152,957) | $ (6,125,751) | 6,809,178 |
Balance (in shares) at Jun. 30, 2022 | 1,281,888 | (228,344) | ||||
Balance at Mar. 31, 2022 | $ 6,406 | 4,670,099 | 8,103,752 | (72,145) | $ (5,841,440) | 6,866,672 |
Balance (in shares) at Mar. 31, 2022 | 1,281,056 | (221,772) | ||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | ||||||
Stock-based compensation | 16,157 | 16,157 | ||||
Stock options/awards | $ 4 | 18,108 | 18,112 | |||
Stock options/awards (in shares) | 832 | |||||
Unrealized gain (loss), net on available-for-sale securities | (1,105) | (1,105) | ||||
Repurchase of common stock | $ (284,311) | (284,311) | ||||
Repurchase of common stock (in shares) | (6,572) | |||||
Foreign currency translation | (79,707) | (79,707) | ||||
Net losses on commodity derivatives | 0 | |||||
Net income | 273,360 | 273,360 | ||||
Balance at Jun. 30, 2022 | $ 6,410 | 4,704,364 | 8,377,112 | (152,957) | $ (6,125,751) | 6,809,178 |
Balance (in shares) at Jun. 30, 2022 | 1,281,888 | (228,344) | ||||
Balance at Dec. 31, 2022 | $ 6,418 | 4,776,804 | 9,001,173 | (159,073) | $ (6,600,281) | 7,025,041 |
Balance (in shares) at Dec. 31, 2022 | 1,283,688 | (239,088) | ||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | ||||||
Stock-based compensation | 15,743 | 15,743 | ||||
Stock options/awards | $ 19 | 36,329 | 36,348 | |||
Stock options/awards (in shares) | 3,704 | |||||
Unrealized gain (loss), net on available-for-sale securities | 3,181 | 3,181 | ||||
Repurchase of common stock | $ (90,378) | (90,378) | ||||
Repurchase of common stock (in shares) | (1,688) | |||||
Retirement of treasury stock | $ (850) | 425 | (4,692,425) | $ 4,692,850 | ||
Retirement of treasury stock (in shares) | (170,000) | 170,000 | ||||
Foreign currency translation | 7,981 | 7,981 | ||||
Net income | 397,444 | 397,444 | ||||
Balance at Mar. 31, 2023 | $ 5,587 | 4,829,301 | 4,706,192 | (147,911) | $ (1,997,809) | 7,395,360 |
Balance (in shares) at Mar. 31, 2023 | 1,117,392 | (70,776) | ||||
Balance at Dec. 31, 2022 | $ 6,418 | 4,776,804 | 9,001,173 | (159,073) | $ (6,600,281) | 7,025,041 |
Balance (in shares) at Dec. 31, 2022 | 1,283,688 | (239,088) | ||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | ||||||
Unrealized gain (loss), net on available-for-sale securities | 2,408 | |||||
Net losses on commodity derivatives | (1,266) | |||||
Net income | 811,315 | |||||
Balance at Jun. 30, 2023 | $ 5,591 | 4,869,791 | 5,120,063 | (155,725) | $ (1,998,256) | 7,841,464 |
Balance (in shares) at Jun. 30, 2023 | 1,118,269 | (70,784) | ||||
Balance at Mar. 31, 2023 | $ 5,587 | 4,829,301 | 4,706,192 | (147,911) | $ (1,997,809) | 7,395,360 |
Balance (in shares) at Mar. 31, 2023 | 1,117,392 | (70,776) | ||||
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | ||||||
Stock-based compensation | 17,176 | 17,176 | ||||
Stock options/awards | $ 4 | 23,314 | 23,318 | |||
Stock options/awards (in shares) | 877 | |||||
Unrealized gain (loss), net on available-for-sale securities | (773) | (773) | ||||
Repurchase of common stock | $ (447) | (447) | ||||
Repurchase of common stock (in shares) | (8) | |||||
Foreign currency translation | (5,775) | (5,775) | ||||
Net losses on commodity derivatives | (1,266) | (1,266) | ||||
Net income | 413,871 | 413,871 | ||||
Balance at Jun. 30, 2023 | $ 5,591 | $ 4,869,791 | $ 5,120,063 | $ (155,725) | $ (1,998,256) | $ 7,841,464 |
Balance (in shares) at Jun. 30, 2023 | 1,118,269 | (70,784) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 811,315 | $ 567,563 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 32,384 | 30,432 |
Non-cash lease expense | 2,828 | 3,222 |
Gain on disposal of property and equipment | (767) | (69) |
Loss on impairment of intangibles | 2,800 | 0 |
Stock-based compensation | 34,603 | 32,609 |
Deferred income taxes | 0 | 21,934 |
Effect on cash of changes in operating assets and liabilities net of acquisition: | ||
Accounts receivable | (317,808) | (289,236) |
Inventories | 93,077 | (299,076) |
Prepaid expenses and other assets | (36,779) | (55,663) |
Prepaid income taxes | (3,345) | (1,220) |
Accounts payable | 132,173 | 85,499 |
Accrued liabilities | 20,491 | (789) |
Accrued promotional allowances | 23,643 | 77,746 |
Accrued compensation | (17,616) | (15,311) |
Income taxes payable | (1,219) | (14,666) |
Other liabilities | (257) | (3,211) |
Deferred revenue | (12,361) | (9,101) |
Net cash provided by operating activities | 763,162 | 130,663 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Sales of available-for-sale investments | 1,037,803 | 1,409,707 |
Purchases of available-for-sale investments | (1,091,126) | (964,267) |
Acquisition of CANarchy, net of cash | 0 | (329,472) |
Purchases of property and equipment | (82,425) | (99,446) |
Proceeds from sale of property and equipment | 1,035 | 372 |
Additions to intangibles | (5,926) | (9,894) |
Increase in other assets | (17,570) | (12,738) |
Net cash used in investing activities | (158,209) | (5,738) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
(Payments) borrowings on debt | (6,661) | 4,924 |
Issuance of common stock | 59,666 | 22,622 |
Purchases of common stock held in treasury | (90,825) | (296,499) |
Net cash used in financing activities | (37,820) | (268,953) |
Effect of exchange rate changes on cash and cash equivalents | (4,500) | (50,395) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 562,633 | (194,423) |
CASH AND CASH EQUIVALENTS, beginning of period | 1,307,141 | 1,326,462 |
CASH AND CASH EQUIVALENTS, end of period | 1,869,774 | 1,132,039 |
Cash paid during the period for: | ||
Interest | 147 | 227 |
Income taxes | $ 232,896 | $ 209,513 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS (Parenthetical) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS | ||
Accrued liabilities for intangible assets | $ 9.6 | $ 3.4 |
Accounts payable for purchase of available-for-sale short-term investment | 3.4 | |
Accounts payable for purchases of equipment | 2 | $ 0.1 |
Included in accounts payable related to additions to other intangible assets | $ 3.2 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Jun. 30, 2023 | |
BASIS OF PRESENTATION | |
BASIS OF PRESENTATION | 1. BASIS OF PRESENTATION Reference is made to the Notes to Consolidated Financial Statements, in Monster Beverage Corporation and Subsidiaries (the “Company”) Annual Report on Form 10-K for the year ended December 31, 2022 for a summary of significant accounting policies utilized by the Company and its consolidated subsidiaries and other disclosures, which should be read in conjunction with this Quarterly Report on Form 10-Q (“Form 10-Q”). The Company’s condensed consolidated financial statements included in this Form 10-Q have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and Securities and Exchange Commission (“SEC”) rules and regulations applicable to interim financial reporting. They do not include all the information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP. The information set forth in these interim condensed consolidated financial statements for the three- and six-months ended June 30, 2023 and 2022, respectively, is unaudited and reflects all adjustments, which include only normal recurring adjustments and which in the opinion of management are necessary to make the interim condensed consolidated financial statements not misleading. Results of operations for periods covered by this report may not necessarily be indicative of results of operations for the full year. The preparation of financial statements in conformity with GAAP necessarily requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from these estimates. Treasury Stock Retirement Stock Split Derivative Financial Instruments – Recent Accounting Pronouncements There have been no changes in recently issued or adopted accounting pronouncements that would materially impact the Company from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 6 Months Ended |
Jun. 30, 2023 | |
REVENUE RECOGNITION | |
REVENUE RECOGNITION | 2. REVENUE RECOGNITION Revenues are accounted for in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606, “Revenue from Contracts with Consumers”. The Company has four operating and reportable segments: (i) Monster Energy® Drinks segment (“Monster Energy® Drinks”), which is primarily comprised of the Company’s Monster Energy® drinks, Reign Total Body Fuel® high performance energy drinks, Monster Tour Water® and Reign Storm® total wellness energy drinks, (ii) Strategic Brands segment (“Strategic Brands”), which is primarily comprised of the various energy drink brands acquired from The Coca-Cola Company (“TCCC”) in 2015 as well as the Company’s affordable energy brands, (iii) Alcohol Brands segment (“Alcohol Brands”), which is primarily comprised of the various craft beers and hard seltzers purchased as part of the acquisition of CANarchy Craft Brewery Collective LLC (“CANarchy”) on February 17, 2022 (the “CANarchy Transaction”) as well as The Beast Unleashed TM The Company’s Monster Energy® Drinks segment primarily generates net operating revenues by selling ready-to-drink packaged energy drinks primarily to bottlers and full service beverage bottlers/distributors (“bottlers/distributors”). In some cases, the Company sells ready-to-drink packaged energy drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military. The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors. The Company’s Alcohol Brands segment primarily generates operating revenues by selling kegged and ready-to-drink canned beers, hard seltzers and FMBs primarily to beer distributors in the United States. The majority of the Company’s revenue is recognized when it satisfies a single performance obligation by transferring control of its products to a customer. Control is generally transferred when the Company’s products are either shipped or delivered based on the terms contained within the underlying contracts or agreements. Certain of the Company’s bottlers/distributors may also perform a separate function as a co-packer on the Company’s behalf. In such cases, control of the Company’s products passes to such bottlers/distributors when they notify the Company that they have taken possession or transferred the relevant portion of the Company’s finished goods. The Company’s general payment terms are short-term in duration. The Company does not have significant financing components or payment terms. The Company did not have any material unsatisfied performance obligations as of June 30, 2023 and December 31, 2022. The Company excludes from revenues all taxes assessed by a governmental authority that are imposed on the sale of its products and collected from customers. Distribution expenses to transport the Company’s products, where applicable, and warehousing expense after manufacture are accounted for within operating expenses. Promotional and other allowances (variable consideration) recorded as a reduction to net sales for the Company’s energy drink products primarily include consideration given to the Company’s non-alcohol bottlers/distributors or retail customers including, but not limited to, the following: ● discounts granted off list prices to support price promotions to end-consumers by retailers; ● reimbursements given to the Company’s bottlers/distributors for agreed portions of their promotional spend with retailers, including slotting, shelf space allowances and other fees for both new and existing products; ● the Company’s agreed share of fees given to bottlers/distributors and/or directly to retailers for advertising, in-store marketing and promotional activities; ● the Company’s agreed share of slotting, shelf space allowances and other fees given directly to retailers, club stores and/or wholesalers; ● incentives given to the Company’s bottlers/distributors and/or retailers for achieving or exceeding certain predetermined sales goals; ● discounted or free products; ● contractual fees given to the Company’s bottlers/distributors related to sales made directly by the Company to certain customers that fall within the bottlers’/distributors’ sales territories; and ● commissions to TCCC based on the Company’s sales to wholly-owned subsidiaries of TCCC (the “TCCC Subsidiaries”) and/or to TCCC bottlers/distributors accounted for under the equity method by TCCC (the “TCCC Related Parties”). The Company’s promotional allowance programs for its energy drink products are executed through separate agreements in the ordinary course of business. These agreements generally provide for one or more of the arrangements described above and are of varying durations, typically ranging from one week to one year. The Company’s promotional and other allowances for its energy drink products are calculated based on various programs with bottlers/distributors and retail customers, and accruals are established at the time of initial product sale for the Company’s anticipated liabilities. These accruals are based on agreed upon terms as well as the Company’s historical experience with similar programs and require management’s judgment with respect to estimating consumer participation and/or bottler/distributor and retail customer performance levels. Differences between such estimated expenses and actual expenses for promotional and other allowance costs have historically been insignificant and are recognized in earnings in the period such differences are determined. Promotional and other allowances for our Alcohol Brands segment primarily include price promotions where permitted. Amounts received pursuant to new and/or amended distribution agreements entered into with certain bottlers/distributors relating to the costs associated with terminating the Company’s prior distributors, are accounted for as deferred revenue and recognized as revenue ratably over the anticipated life of the respective distribution agreements, generally over 20 years. The Company also enters into license agreements that generate revenues associated with third-party sales of non-beverage products bearing the Company’s trademarks including, but not limited to, clothing, hats, t-shirts, jackets, helmets and automotive wheels. Management believes that adequate provision has been made for cash discounts, returns and spoilage based on the Company’s historical experience. Disaggregation of Revenue The following tables disaggregate the Company’s revenue by geographical markets and reportable segments: Three-Months Ended June 30, 2023 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 1,068,887 $ 339,522 $ 138,478 $ 140,000 $ 1,686,887 Strategic Brands 47,226 42,050 7,828 2,586 99,690 Alcohol Brands 61,076 — — — 61,076 Other 7,308 — — — 7,308 Total Net Sales $ 1,184,497 $ 381,572 $ 146,306 $ 142,586 $ 1,854,961 Three-Months Ended June 30, 2022 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 973,674 $ 308,839 $ 116,788 $ 138,389 $ 1,537,690 Strategic Brands 38,368 29,171 7,477 4,126 79,142 Alcohol Brands 32,447 — — — 32,447 Other 5,981 — — — 5,981 Total Net Sales $ 1,050,470 $ 338,010 $ 124,265 $ 142,515 $ 1,655,260 1 Europe, Middle East and Africa (“EMEA”) Six-Months Ended June 30, 2023 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 2,090,215 $ 616,633 $ 260,472 $ 281,235 $ 3,248,555 Strategic Brands 90,269 73,001 16,811 5,967 186,048 Alcohol Brands 107,366 — — — 107,366 Other 11,922 — — — 11,922 Total Net Sales $ 2,299,772 $ 689,634 $ 277,283 $ 287,202 $ 3,553,891 Six-Months Ended June 30, 2022 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 1,899,354 $ 569,728 $ 227,343 $ 246,111 $ 2,942,536 Strategic Brands 91,420 59,347 14,138 6,830 171,735 Alcohol Brands 2 47,654 — — — 47,654 Other 11,908 — — — 11,908 Total Net Sales $ 2,050,336 $ 629,075 $ 241,481 $ 252,941 $ 3,173,833 1 Europe, Middle East and Africa (“EMEA”) 2 Effectively from February 17, 2022 to June 30, 2022 Contract Liabilities Amounts received from certain bottlers/distributors at inception of their distribution contracts or at the inception of certain sales/marketing programs are accounted for as deferred revenue. As of June 30, 2023, the Company had $257.8 million of deferred revenue, which is included in current and long-term deferred revenue in the Company’s condensed consolidated balance sheet. As of December 31, 2022, the Company had $267.1 million of deferred revenue, which is included in current and long-term deferred revenue in the Company’s condensed consolidated balance sheet. During the three-months ended June 30, 2023 and 2022, $10.0 million and $10.1 million, respectively, of deferred revenue was recognized in net sales. See Note 10. During the six-months ended June 30, 2023 and 2022, $19.9 million and $20.1 million, respectively, of deferred revenue was recognized in net sales. See Note 10. |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2023 | |
LEASES | |
LEASES | 3. LEASES The Company leases identified assets consisting primarily of office and warehouse space, warehouse equipment and vehicles. Leases are classified as either finance leases or operating leases based on criteria in ASC 842, “Leases”. The Company’s leases have remaining lease terms of less than one year to 11 years, some which leases leases The components of lease cost were as follows: Three-Months Ended June 30, Six-Months Ended June 30, 2023 2022 2023 2022 Operating lease cost $ 2,616 $ 2,238 $ 5,083 $ 3,932 Short-term lease cost 1,070 939 2,049 1,869 Variable lease cost 226 195 441 378 Finance leases: Amortization of right-of-use assets 202 148 325 275 Interest on lease liabilities 44 7 58 10 Finance lease cost 246 155 383 285 Total lease cost $ 4,158 $ 3,527 $ 7,956 $ 6,464 Supplemental cash flow information related to leases was as follows: Six-Months Ended June 30, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 4,818 $ 3,682 Operating cash outflows from finance leases 58 10 Financing cash outflows from finance leases 1,683 1,179 Right-of-use assets obtained in exchange for lease obligations: Finance leases 5,115 1,561 Operating leases 1,847 18,339 Supplemental balance sheet information related to leases was as follows: June 30, December 31, Balance Sheet Location 2023 2022 Operating leases: Right-of-use assets Other assets $ 37,111 $ 38,012 Current lease liabilities Accrued liabilities $ 7,835 $ 7,747 Noncurrent lease liabilities Other liabilities 28,829 29,586 Total operating lease liabilities $ 36,664 $ 37,333 Finance leases: Right-of-use assets Property and equipment, net $ 5,335 $ 1,598 Current lease liabilities Accrued liabilities $ 4,205 $ 757 Noncurrent lease liabilities Other liabilities 29 41 Total finance lease liabilities $ 4,234 $ 798 Weighted-average remaining lease term and weighted-average discount rate for the Company’s leases were as follows: June 30, 2023 December 31, 2022 Weighted-average remaining lease term in years: Operating leases 6.5 6.7 Finance leases 0.8 0.8 Weighted-average discount rate: Operating leases 3.6 % 3.4 % Finance leases 5.9 % 3.6 % The following table outlines maturities of the Company’s lease liabilities as of June 30, 2023: Operating Leases Finance Leases 2023 (from July 1, 2023 to December 31, 2023) $ 4,592 $ 2,711 2024 8,089 1,620 2025 5,962 17 2026 4,780 2 2027 4,650 — 2028 and thereafter 13,183 — Total lease payments 41,256 4,350 Less imputed interest (4,592) (116) Total $ 36,664 $ 4,234 As of June 30, 2023, the Company did not have any significant additional leases that had not yet commenced. |
INVESTMENTS
INVESTMENTS | 6 Months Ended |
Jun. 30, 2023 | |
INVESTMENTS | |
INVESTMENTS | 4. INVESTMENTS The following table summarizes the Company’s investments at: Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 June 30, 2023 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 329,770 $ — $ 2 $ 329,768 $ 2 $ — Certificates of deposit 15,161 — — 15,161 — — Municipal securities 59,158 — 125 59,033 125 — U.S. government agency securities 152,071 — 489 151,582 489 — U.S. treasuries 705,370 31 2,002 703,399 2,002 — Corporate bonds 158,748 10 462 158,296 462 — Long-term: U.S. government agency securities 2,580 — 9 2,571 9 — U.S. treasuries 39,011 — 309 38,702 309 — Corporate bonds 21,065 — 90 20,975 90 — Total $ 1,482,934 $ 41 $ 3,488 $ 1,479,487 $ 3,488 $ — Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 December 31, 2022 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 197,712 $ 1 $ 4 $ 197,709 $ 4 $ — Certificates of deposit 10,078 — — 10,078 — — Municipal securities 211,791 60 612 211,239 612 — U.S. government agency securities 109,697 3 715 108,985 715 — U.S. treasuries 838,825 17 4,539 834,303 4,539 — Long-term: U.S. government agency securities 2,016 — 3 2,013 3 — U.S. treasuries 53,215 20 71 53,164 71 — Variable rate demand notes 6,266 — — 6,266 — — Total $ 1,429,600 $ 101 $ 5,944 $ 1,423,757 $ 5,944 $ — During the three- and six-months ended June 30, 2023 and 2022, realized gains or losses recognized on the sale of investments were not significant. The Company’s investments at June 30, 2023 and December 31, 2022 carried investment grade credit ratings. The following table summarizes the underlying contractual maturities of the Company’s investments at: June 30, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value Less than 1 year: Commercial paper $ 329,770 $ 329,768 $ 197,712 $ 197,710 Municipal securities 59,158 59,033 211,791 211,239 U.S. government agency securities 152,071 151,582 109,697 108,985 Certificates of deposit 15,161 15,161 10,078 10,078 U.S. treasuries 705,370 703,399 838,825 834,302 Corporate bonds 158,748 158,296 — — Due 1 - 10 years: U.S. treasuries 39,011 38,702 53,215 53,164 U.S. government agency securities 2,580 2,571 2,016 2,013 Variable rate demand notes — — 4,862 4,862 Corporate bonds 21,065 20,975 — — Due 11 - 20 years: Variable rate demand notes — — 1,404 1,404 Total $ 1,482,934 $ 1,479,487 $ 1,429,600 $ 1,423,757 |
FAIR VALUE OF CERTAIN FINANCIAL
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | 6 Months Ended |
Jun. 30, 2023 | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | 5. FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES ASC 820, “Fair Value Measurement”, provides a framework for measuring fair value and requires disclosures regarding fair value measurements. ASC 820 defines fair value as the price that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs, where available. The three levels of inputs required by the standard that the Company uses to measure fair value are summarized below. ● Level 1: Quoted prices in active markets for identical assets or liabilities. ● Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the related assets or liabilities. ● Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. ASC 820 requires the use of observable market inputs (quoted market prices) when measuring fair value and requires a Level 1 quoted price to be used to measure fair value whenever possible. The following tables present the fair value of the Company’s financial assets and liabilities that are recorded at fair value on a recurring basis, segregated among the appropriate levels within the fair value hierarchy at: June 30, 2023 Level 1 Level 2 Level 3 Total Cash $ 877,582 $ — $ — $ 877,582 Money market funds 911,446 — — 911,446 Certificates of deposit — 47,109 — 47,109 Commercial paper — 336,764 — 336,764 Corporate bonds — 179,271 — 179,271 Municipal securities — 59,033 — 59,033 U.S. government agency securities — 162,351 — 162,351 U.S. treasuries — 775,707 — 775,707 Foreign currency derivatives — 178 — 178 Commodity derivatives — (1,266) — (1,266) Total $ 1,789,028 $ 1,559,147 $ — $ 3,348,175 Amounts included in: Cash and cash equivalents $ 1,789,028 $ 80,746 $ — $ 1,869,774 Short-term investments — 1,417,239 — 1,417,239 Accounts receivable, net — 270 — 270 Investments — 62,248 — 62,248 Accrued liabilities — (1,219) — (1,219) Other liabilities — (137) — (137) Total $ 1,789,028 $ 1,559,147 $ — $ 3,348,175 December 31, 2022 Level 1 Level 2 Level 3 Total Cash $ 1,132,509 $ — $ — $ 1,132,509 Money market funds 121,444 — — 121,444 Certificates of deposit — 10,078 — 10,078 Commercial paper — 225,067 — 225,067 Variable rate demand notes — 6,266 — 6,266 Municipal securities — 213,798 — 213,798 U.S. government agency securities — 113,357 — 113,357 U.S. treasuries — 908,379 — 908,379 Foreign currency derivatives — (3,733) — (3,733) Total $ 1,253,953 $ 1,473,212 $ — $ 2,727,165 Amounts included in: Cash and cash equivalents $ 1,253,953 $ 53,188 $ — $ 1,307,141 Short-term investments — 1,362,314 — 1,362,314 Accounts receivable, net — 965 — 965 Investments — 61,443 — 61,443 Accrued liabilities — (4,698) — (4,698) Total $ 1,253,953 $ 1,473,212 $ — $ 2,727,165 All of the Company’s short-term and long-term investments are classified within Level 1 or Level 2 of the fair value hierarchy. The Company’s valuation of its Level 1 investments is based on quoted market prices in active markets for identical securities. The Company’s valuation of its Level 2 investments is based on other observable inputs, specifically a market approach which utilizes valuation models, pricing systems, mathematical tools and other relevant information for the same or similar securities. The Company’s valuation of its Level 2 foreign currency exchange contracts is based on quoted market prices of the same or similar instruments, adjusted for counterparty risk. There were no transfers between Level 1 and Level 2 measurements during the three- and six-months ended June 30, 2023, or during the year-ended December 31, 2022, and there were no changes in the Company’s valuation techniques. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 6 Months Ended |
Jun. 30, 2023 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 6. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The Company accounts for its derivative instruments and hedging activities under ASC 815, “Derivatives and Hedging.” The following table presents the fair values of the Company’s derivative instruments: Fair value June 30, December 31, Derivatives designated as hedging instruments 2023 2022 Balance Sheet location Assets: Commodity contracts $ — $ — Accounts receivable, net Liabilities: Commodity contracts $ (1,129) $ — Accrued liabilities Commodity contracts $ (137) $ — Other liabilities Fair value June 30, December 31, Derivatives not designated as hedging instruments 2023 2022 Balance Sheet location Assets: Foreign currency exchange contracts $ 270 $ 965 Accounts receivable, net Liabilities: Foreign currency exchange contracts $ (92) $ (4,698) Accrued liabilities Cash Flow Hedging Strategy The Company uses cash flow hedges to minimize the variability in cash flows of forecasted transactions caused by fluctuations in commodity prices. The changes in the fair values of derivatives designated as cash flow hedges are recorded in accumulated other comprehensive income (loss) (“AOCI”) and are reclassified into the line item in our condensed consolidated statement of income in which the hedged items are recorded in the same period that the hedged items affect earnings. The changes in the fair values of hedges that are determined to be ineffective are immediately reclassified from AOCI into earnings. The maximum length of time for which the Company hedges its exposure to the variability in future cash flows is currently less than two years. The Company has entered into commodity hedge contracts to mitigate the price risk associated with a portion of its forecasted aluminum purchases. These derivative instruments were designated as part of the Company’s commodity cash flow hedging program. The objective of this hedging program is to reduce the variability of cash flows associated with future purchases of aluminum. The total notional values of derivatives that were designated and qualified for this program were $30.4 million as of June 30, 2023. Transactions under the commodity cash flow hedging program were executed beginning in May 2023. The following table presents the impact that changes in the fair values of derivatives designated as cash flow hedges had on other comprehensive income (“OCI”), AOCI and earnings: Three-months ended June 30, 2023 Derivatives Gain (loss) designated as Gain (loss) recognized Location of gain (loss) reclassified from hedging instruments in AOCI recognized in income AOCI into income Commodity contracts $ (1,266) Cost of sales $ — Six-months ended June 30, 2023 Derivatives Gain (loss) designated as Gain (loss) recognized Location of gain (loss) reclassified from hedging instruments in AOCI recognized in income AOCI into income Commodity contracts $ (1,266) Cost of sales $ — As of June 30, 2023, the Company estimates that it will reclassify into earnings net gains (losses) of ($1.0) million from the amount recorded in AOCI as the anticipated cash flows occur during the next 12 months. Economic (Non-Designated) Hedging Strategy The Company is exposed to foreign currency exchange rate risks related primarily to its foreign business operations. During the six-months ended June 30, 2023 and the year-ended December 31, 2022, the Company entered into forward currency exchange contracts with financial institutions to create an economic hedge to specifically manage a portion of the foreign exchange risk exposure associated with certain consolidated subsidiaries’ non-functional currency denominated assets and liabilities. All foreign currency exchange contracts of the Company that were outstanding as of June 30, 2023 have terms of one month or less. The Company does not enter into forward currency exchange contracts for speculation or trading purposes. The Company has not designated its foreign currency exchange contracts as hedge transactions. Therefore, gains and losses on the Company’s foreign currency exchange contracts are recognized in interest and other income (expense), net, in the condensed consolidated statements of income, and are largely offset by the changes in the fair value of the underlying economically hedged item. The total notional values of derivatives related to our foreign currency economic hedges were $176.0 million and $299.8 million as of June 30, 2023 and December 31, 2022, respectively. The net gains (losses) on derivatives not designated as hedging instruments in the condensed consolidated statements of income were as follows: Gain (loss) recognized in income on derivatives Three-months ended Derivatives not designated as Location of gain (loss) June 30, June 30, hedging instruments recognized in income on derivatives 2023 2022 Foreign currency exchange contracts Interest and other income (expense), net $ (1,924) $ 743 Gain (loss) recognized in income on derivatives Six-months ended Derivatives not designated as Location of gain (loss) June 30, June 30, hedging instruments recognized in income on derivatives 2023 2022 Foreign currency exchange contracts Interest and other income (expense), net $ (9,775) $ (3,275) Certain of the Company’s counterparty agreements contain provisions that require the Company to post collateral on derivative instruments in a net liability position, for which the Company posted collateral of $1.1 million as of June 30, 2023. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2023 | |
INVENTORIES | |
INVENTORIES | 7. INVENTORIES Inventories consist of the following at: June 30, December 31, 2023 2022 Raw materials $ 399,564 $ 467,392 Work in process 1,848 1,688 Finished goods 445,400 466,551 $ 846,812 $ 935,631 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 6 Months Ended |
Jun. 30, 2023 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | 8. PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following at: June 30, December 31, 2023 2022 Land $ 139,975 $ 139,798 Leasehold improvements 33,245 31,327 Furniture and fixtures 9,393 9,286 Office and computer equipment 23,326 22,386 Computer software 4,941 5,906 Equipment 269,671 244,739 Buildings 165,598 163,885 Vehicles 57,162 49,175 Assets under construction 133,086 83,553 836,397 750,055 Less: accumulated depreciation and amortization (259,752) (233,158) $ 576,645 $ 516,897 Total depreciation and amortization expense was $14.7 million and $13.8 million for the three-months ended June 30, 2023 and 2022, respectively. Total depreciation and amortization expense was $29.5 million and $26.9 million for the six-months ended June 30, 2023 and 2022, respectively. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2023 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | 9. The following is a roll-forward of goodwill for the six-months ended June 30, 2023 and 2022 by reportable segment: Monster Energy® Strategic Alcohol Drinks Brands Brands Other Total Balance at December 31, 2022 $ 693,644 $ 637,999 $ 86,298 $ — $ 1,417,941 Acquisitions — — — — — Balance at June 30, 2023 $ 693,644 $ 637,999 $ 86,298 $ — $ 1,417,941 Monster Energy® Strategic Alcohol Drinks Brands Brands Other Total Balance at December 31, 2021 $ 693,644 $ 637,999 $ — $ — $ 1,331,643 Acquisitions — — 81,298 — 81,298 Balance at June 30, 2022 $ 693,644 $ 637,999 $ 81,298 $ — $ 1,412,941 Intangible assets consist of the following at: June 30, December 31, 2023 2022 Amortizing intangibles $ 121,378 $ 121,378 Accumulated amortization (71,712) (68,790) 49,666 52,588 Non-amortizing intangibles 1,174,434 1,167,822 $ 1,224,100 $ 1,220,410 Amortizing intangibles primarily consist of customer relationships. All amortizing intangibles have been assigned an estimated finite useful life and such intangibles are amortized on a straight-line basis over the number of years that approximate their respective useful lives, generally five The following is the future estimated amortization expense related to amortizing intangibles as of June 30, 2023: 2023 (from July 1, 2023 to December 31, 2023) $ 1,824 2024 3,648 2025 3,647 2026 3,647 2027 3,646 2028 and thereafter 33,254 $ 49,666 |
DISTRIBUTION AGREEMENTS
DISTRIBUTION AGREEMENTS | 6 Months Ended |
Jun. 30, 2023 | |
DISTRIBUTION AGREEMENTS | |
DISTRIBUTION AGREEMENTS | 10 DISTRIBUTION AGREEMENTS In the normal course of business, amounts received pursuant to new and/or amended distribution agreements entered into with certain bottlers/distributors, relating to the costs associated with terminating agreements with the Company’s prior distributors, or at the inception of certain sales/marketing programs are accounted for as deferred revenue and are recognized as revenue ratably over the anticipated life of the respective agreement, generally 20 years or program duration, as the case may be. Revenue recognized was $10.0 million and $10.1 million for the three-months ended June 30, 2023 and 2022, respectively. Revenue recognized was $19.9 million and $20.1 million for the six-months ended June 30, 2023 and 2022, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 11. COMMITMENTS AND CONTINGENCIES The Company had purchase commitments aggregating approximately $309.3 million at June 30, 2023, which represented commitments made by the Company and its subsidiaries to various suppliers of raw materials for the production of its products. These obligations vary in terms, but are generally satisfied within one year. The Company had contractual obligations aggregating approximately $380.4 million at June 30, 2023, which related primarily to sponsorships and other marketing activities. The Company has a credit facility with HSBC Bank (China) Company Limited, Shanghai Branch, of $15.0 million. At June 30, 2023, the interest rate on borrowings under the line of credit was 5.5%. As of June 30, 2023, $2.7 million was outstanding on this line of credit. Litigation The Company evaluates, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that is accrued, if any, and any related insurance reimbursements. As of June 30, 2023, $0.3 million of loss contingencies were included in the Company’s accompanying consolidated balance sheet. As of December 31, 2022, no loss contingencies were included in the Company’s accompanying consolidated balance sheet. On September 29, 2022, a jury in the U.S. District Court for the Central District of California (the “District Court”) awarded Monster Energy Company (“MEC”) approximately $293 million in damages in its false advertising and trade secrets case (the “Jury Award”) against Vital Pharmaceuticals, Inc. (“VPX”), the maker of Bang Energy. The jury found VPX and its former chief executive officer John H. Owoc to have falsely advertised the “Super Creatine” ingredient of Bang Energy and to have acted willfully and deliberately in violating the federal Lanham Act. The jury also found that VPX stole trade secrets and interfered with MEC’s contracts over shelf space with certain key vendors. On April 12, 2023, the District Court granted Monster’s motion for a permanent injunction which, among other things, enjoined VPX, Mr. Owoc, and others working in concert with them from falsely or deceptively claiming that BANG or any other beverages contain creatine or a form of creatine, requires them to remove all such advertising within 60 days, and required VPX and Mr. Owoc to issue corrective statements to consumers and non-consumer partners, including retailers and distributors. In April 2022, MEC and Orange Bang, Inc. (“Orange Bang”) filed a joint motion in a separate District Court action to confirm a final arbitration award against VPX that awarded MEC and Orange Bang $175.0 million and a 5% royalty on all future sales of VPX’s Bang Energy drink and other Bang-branded products as well as certain fees and costs (the “Arbitration Award”). The arbitration arose from a settlement agreement that VPX entered into in 2010 with Orange Bang, a family-owned beverage business. Pursuant to the terms of that agreement, VPX is only permitted to use the Bang mark on “creatine-based” products or on Bang products that are marketed and sold only in the vitamin and dietary supplement sections of stores. On September 29, 2022, the District Court entered final judgment confirming the Arbitration Award. On October 28, 2022, VPX filed a notice of appeal of the District Court’s final judgment confirming the Arbitration award. On October 10, 2022, VPX, along with certain of its domestic subsidiaries and affiliates, filed for protection under Chapter 11 of the Bankruptcy Code in the Southern District of Florida. Due to such ongoing proceedings, VPX’s appeal of the District Court’s final judgment confirming the Arbitration Award was stayed. While reserving all rights to appeal, VPX made its first royalty payment of $3.6 million on February 14, 2023, which is for sales of Bang Energy drink and other Bang-branded products from October 10, 2022 through December 31, 2022. On May 25, 2023, VPX made an additional royalty payment in the amount of approximately $3.7 million for sales of Bang-branded products from January 1, 2023 through March 31, 2023. Per ASC 450 “Contingencies”, the Company will not recognize the royalty payments until they are realized or realizable. On June 28, 2023, VPX and certain of its affiliates (“Bang Energy”) entered into an Asset Purchase Agreement (the “APA”) with the Company (“Buyer”), which among other things, provided for the Buyer’s acquisition of substantially all of Bang Energy’s assets. The transactions contemplated by the APA were approved by the U.S. Bankruptcy Court for the Southern District of Florida on July 14, 2023 and closed on July 31, 2023, at which time Monster was deemed to have allowed general unsecured claims in VPX’s bankruptcy case relating to the Jury Award (subject to the potential modification of the Jury Award in light of pending post-verdict motions filed by MEC and VPX) and the Arbitration Award. Pursuant to the APA, Bang Energy and the Company have mutually released each other from all claims and liabilities related to the Jury Award and the Arbitration Award, except any claims that the Company might have against Mr. Owoc in relation to the Jury Award. Per ASC 450 “Contingencies”, the Company will not recognize the allowed general unsecured claims, or the Jury Award as it relates to Mr. Owoc, until they are realized or realizable. In June 2023, the Company entered into an agreement with Orange Bang regarding the Company’s use and registration of certain Bang® trademarks and trade names, subject to the successful closure of the APA. Under this agreement, the Company will pay Orange Bang a one-time payment of approximately $12.5 million and a 2.5% royalty on all future sales of products bearing the tradename Bang®. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 6 Months Ended |
Jun. 30, 2023 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | 12. ACCUMULATED OTHER COMPREHENSIVE LOSS Changes in accumulated other comprehensive loss by component, after tax, for the six-months ended June 30, 2023 and 2022 are as follows: Accumulated Unrealized Net Losses on Currency Gains (Losses) Commodity Translation on Available-for- Derivatives Gains (Losses) Sale Securities Total Balance at December 31, 2022 $ — $ (153,230) $ (5,843) $ (159,073) Other comprehensive income before reclassifications (1,266) 2,206 2,408 3,348 Net current-period other comprehensive (loss) gain (1,266) 2,206 2,408 3,348 Balance at June 30, 2023 $ (1,266) $ (151,024) $ (3,435) $ (155,725) Accumulated Unrealized Net Losses on Currency Losses Commodity Translation on Available-for- Derivatives Losses Sale Securities Total Balance at December 31, 2021 $ — $ (68,209) $ (956) $ (69,165) Other comprehensive loss before reclassifications — (78,628) (5,164) (83,792) Net current-period other comprehensive loss — (78,628) (5,164) (83,792) Balance at June 30, 2022 $ — $ (146,837) $ (6,120) $ (152,957) |
TREASURY STOCK
TREASURY STOCK | 6 Months Ended |
Jun. 30, 2023 | |
TREASURY STOCK | |
TREASURY STOCK | 13. TREASURY STOCK On March 10, 2023, the Company retired 170.0 million shares (stock split adjusted) of treasury stock owned by the Company. The retired stock had a carrying value of approximately$4.69 billion. The Company’s accounting policy upon the formal retirement of treasury stock is to deduct its par value from common stock and to reflect any excess of cost over par as a deduction from retained earnings. On June 14, 2022, the Company’s Board of Directors authorized a share repurchase program for the purchase of up to $500.0 million of the Company’s outstanding common stock (the “June 2022 Repurchase Plan”). During the three-months ended June 30, 2023, no shares were repurchased under the June 2022 Repurchase Plan. As of August 4, 2023, $182.8 million remained available for repurchase under the June 2022 Repurchase Plan. On November 2, 2022, the Company’s Board of Directors authorized a share repurchase program for the purchase of up to an additional $500.0 million of the Company’s outstanding common stock (the “November 2022 Repurchase Plan”). During the three-months ended June 30, 2023, no shares were repurchased under the November 2022 Repurchase Plan. As of August 4, 2023, $500.0 million remained available for repurchase under the November 2022 Repurchase Plan. The aggregate amount of the Company’s outstanding common stock that remains available for repurchase under all previously authorized repurchase plans is $682.8 million as of August 4, 2023. During the three-months ended June 30, 2023, 7,579 shares of common stock were purchased from employees in lieu of cash payments for options exercised or withholding taxes due for a total amount of $0.4 million. While such purchases are considered common stock repurchases, they are not counted as purchases against the Company’s authorized share repurchase programs. Such shares are included in common stock in treasury in the accompanying consolidated balance sheet at June 30, 2023. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2023 | |
STOCK-BASED COMPENSATION | |
STOCK-BASED COMPENSATION | 14. STOCK-BASED COMPENSATION The Company has two stock-based compensation plans under which shares were available for grant at June 30, 2023: (i) the Monster Beverage Corporation 2020 Omnibus Incentive Plan, including the Monster Beverage Corporation Deferred Compensation Plan as a sub-plan thereunder, and (ii) the Monster Beverage Corporation 2017 Compensation Plan for Non-Employee Directors as Amended and Restated on February 23, 2022, including the Monster Beverage Corporation Deferred Compensation Plan for Non-Employee Directors as a sub-plan thereunder. The Company recorded $18.6 million and $16.3 million of compensation expense relating to outstanding options, restricted stock units, performance share units and other share-based awards during the three-months ended June 30, 2023 and 2022, respectively. The Company recorded $34.6 million and $32.6 million of compensation expense relating to outstanding options, restricted stock units, performance share units and other share-based awards during the six-months ended June 30, 2023 and 2022, respectively. The tax benefit for tax deductions from non-qualified stock option exercises, disqualifying dispositions of incentive stock options and vesting of restricted stock units and performance share units for the three-months ended June 30, 2023 and 2022 was $4.1 million and $2.2 million, respectively. The tax benefit for tax deductions from non-qualified stock option exercises, disqualifying dispositions of incentive stock options and vesting of restricted stock units and performance share units for the six-months ended June 30, 2023 and 2022 was $30.0 million and $2.7 million, respectively. Stock Options Under the Company’s stock-based compensation plans, all stock options granted as of June 30, 2023 were granted at prices based on the fair value of the Company’s common stock on the date of grant. The Company records compensation expense for stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes-Merton option pricing formula with the assumptions included in the table below. The Company uses historical data to determine the exercise behavior, volatility and forfeiture rate of the options. The following weighted-average assumptions were used to estimate the fair value of options granted during: Three-Months Ended June 30, Six-Months Ended June 30, 2023 2022 2023 2022 Dividend yield 0.0 % 0.0 % 0.0 % 0.0 % Expected volatility 27.4 % 27.8 % 27.6 % 27.7 % Risk-free interest rate 3.7 % 3.0 % 3.7 % 2.1 % Expected term 6.3 years 6.2 years 6.3 years 6.0 years Expected Volatility Risk-Free Interest Rate Expected Term The following table summarizes the Company’s activities with respect to its stock option plans as follows: Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Shares (in Price Per Term (in Aggregate Options thousands) Share years) Intrinsic Value Outstanding at January 1, 2023 29,710 $ 26.38 5.0 $ 724,651 Granted 01/01/23 - 03/31/23 3,962 $ 50.82 Granted 04/01/23 - 06/30/23 31 $ 59.36 Exercised (3,990) $ 14.95 Cancelled or forfeited (222) $ 37.82 Outstanding at June 30, 2023 29,491 $ 31.15 5.6 $ 775,296 Vested and expected to vest in the future at June 30, 2023 28,511 $ 30.71 5.4 $ 762,069 Exercisable at June 30, 2023 18,659 $ 24.70 3.8 $ 610,938 The weighted-average grant-date fair value of options granted during the three-months ended June 30, 2023 and 2022 was $21.14 per share and $14.96 per share, respectively. The weighted-average grant-date fair value of options granted during the six-months ended June 30, 2023 and 2022 was $18.25 per share and $11.62 per share, respectively. The total intrinsic value of options exercised during the three-months ended June 30, 2023 and 2022 was $26.9 million and $18.0 million, respectively. The total intrinsic value of options exercised during the six-months ended June 30, 2023 and 2022 was $157.9 million and $22.9 million, respectively. Cash received from option exercises under all plans for the three-months ended June 30, 2023 and 2022 was $23.3 million and $18.1 million, respectively. Cash received from option exercises under all plans for the six-months ended June 30, 2023 and 2022 was $59.7 million and $22.6 million, respectively. At June 30, 2023, there was $115.6 million of total unrecognized compensation expense related to non-vested options granted to employees under the Company’s stock-based compensation plans. That cost is expected to be recognized over a weighted-average period of 3.4 years. Restricted Stock Units and Performance Share Units The cost of stock-based compensation for restricted stock units and performance share units is measured based on the closing fair market value of the Company’s common stock at the date of grant. In the event that the Company has the option and intent to settle a restricted stock unit or performance share unit in cash, the award is classified as a liability and revalued at each balance sheet date. The following table summarizes the Company’s activities with respect to non-vested restricted stock units and performance share units as follows: Weighted Number of Average Shares (in Grant-Date thousands) Fair Value Non-vested at January 1, 2023 2,026 $ 36.27 Granted 01/01/23 - 03/31/23 1 523 $ 48.49 Granted 04/01/23 - 06/30/23 22 $ 59.70 Vested (592) $ 32.80 Forfeited/cancelled (11) $ 32.83 Non-vested at June 30, 2023 1,968 $ 40.85 1 The grant activity for performance share units is recorded based on the target performance level earning 100% of target performance share units. The actual number of performance share units earned could range from 0% to 200% of target depending on the achievement of pre-established performance goals. The weighted-average grant-date fair value of restricted stock units and/or performance share units granted during the three-months ended June 30, 2023 and 2022 was $59.17 and $43.76 per share, respectively. The weighted-average grant-date fair value of restricted stock units and/or performance share units granted during the six-months ended June 30, 2023 and 2022 was $48.93 and $36.98 per share, respectively. As of June 30, 2023, 1.9 million of restricted stock units and performance share units are expected to vest over their respective terms. At June 30, 2023, total unrecognized compensation expense relating to non-vested restricted stock units and performance share units was $47.1 million, which is expected to be recognized over a weighted-average period of 1.7 years. Other Share-Based Awards The Company has granted other share-based awards to certain employees that are payable in cash. These awards are classified as liabilities and are valued based on the fair value of the award at the grant date and are remeasured at each reporting date until settlement, with compensation expense being recognized in proportion to the completed requisite service period up until date of settlement. At June 30, 2023, other share-based awards outstanding included grants that vest over three years payable in the first quarters of 2024, 2025 and 2026. At June 30, 2023, there was $1.5 million of total unrecognized compensation expense related to nonvested other share-based awards granted to employees under the Company’s stock-based compensation plans. That expense is expected to be recognized over a weighted-average period of 1.7 years. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2023 | |
INCOME TAXES | |
INCOME TAXES | 15. INCOME TAXES The following is a roll-forward of the Company’s total gross unrecognized tax benefits, not including interest and penalties, for the six-months ended June 30, 2023: Gross Unrecognized Tax Benefits Balance at December 31, 2022 $ 3,020 Additions for tax positions related to the current year — Additions for tax positions related to the prior years 738 Decreases for tax positions related to the prior years — Balance at June 30, 2023 $ 3,758 The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in the Company’s condensed consolidated financial statements. As of June 30, 2023, the Company had approximately $0.6 million in accrued interest and penalties related to unrecognized tax benefits. If the Company were to prevail on all uncertain tax positions, the resultant impact on the Company’s effective tax rate would not be significant. It is expected that any change in the amount of unrecognized tax benefits within the next 12 months will not be significant. The Company is subject to U.S. federal income tax as well as to income tax in multiple state and foreign jurisdictions. The Company is in various stages of examination with certain states and certain foreign jurisdictions. The Company’s 2019 through 2022 U.S. federal income tax returns are subject to examination by the IRS. The Company’s state income tax returns are subject to examination for the 2018 through 2022 tax years. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Jun. 30, 2023 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 16. EARNINGS PER SHARE A reconciliation of the weighted-average shares used in the basic and diluted earnings per common share computations is presented below (in thousands): Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Weighted-average shares outstanding: Basic 1,047,065 1,057,233 1,045,993 1,058,017 Dilutive 13,028 12,389 13,674 12,401 Diluted 1,060,093 1,069,622 1,059,667 1,070,418 For the three-months ended June 30, 2023 and 2022, options and awards outstanding totaling 4.1 million shares and 3.5 million shares, respectively, were excluded from the calculations as their effect would have been antidilutive. For the six-months ended June 30, 2023 and 2022, options and awards outstanding totaling 2.6 million shares and 2.5 million shares, respectively, were excluded from the calculations as their effect would have been antidilutive. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2023 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 17. SEGMENT INFORMATION The Company has four operating and reportable TM The Company’s Monster Energy® Drinks segment primarily generates net operating revenues by selling ready-to-drink packaged drinks primarily to bottlers/distributors. In some cases, the Company sells ready-to-drink packaged drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military. The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors. Generally, the Monster Energy® Drinks segment generates higher per case net operating revenues, but lower per case gross profit margin percentages than the Strategic Brands segment. The Company’s Alcohol Brands segment primarily generates operating revenues by selling kegged and ready-to-drink canned beers, hard seltzers and FMBs primarily to beer distributors in the United States. Generally, the Alcohol Brands segment has lower gross profit margin percentages than the Monster Energy® Drinks segment. Corporate and unallocated amounts that do not relate to a reportable segment have been allocated to “Corporate & Unallocated.” No asset information, other than goodwill and other intangible assets, has been provided in the Company’s reportable segments, as management does not measure or allocate such assets on a segment basis. The net revenues derived from the Company’s reportable segments and other financial information related thereto for the three- and six-months ended June 30, 2023 and 2022 were as follows: Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Net sales: Monster Energy® Drinks 1 $ 1,686,887 $ 1,537,690 $ 3,248,555 $ 2,942,536 Strategic Brands 99,690 79,142 186,048 171,735 Alcohol Brands 2 61,076 32,447 107,366 47,654 Other 7,308 5,981 11,922 11,908 Corporate and unallocated — — — — $ 1,854,961 $ 1,655,260 $ 3,553,891 $ 3,173,833 Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Operating Income: Monster Energy® Drinks 1 $ 597,922 $ 441,719 $ 1,158,740 $ 896,282 Strategic Brands 55,137 41,500 106,909 98,695 Alcohol Brands 2 (6,577) (4,657) (13,460) (9,611) Other 1,651 1,034 1,358 2,161 Corporate and unallocated (124,328) (106,645) (244,677) (215,088) $ 523,805 $ 372,951 $ 1,008,870 $ 772,439 Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Income before tax: Monster Energy® Drinks 1 $ 598,656 $ 442,407 $ 1,160,330 $ 897,540 Strategic Brands 55,149 41,509 106,938 98,763 Alcohol Brands 2 (6,584) (3,890) (13,451) (9,496) Other 1,657 1,025 1,364 2,162 Corporate and unallocated (109,914) (114,881) (218,658) (230,610) $ 538,964 $ 366,170 $ 1,036,523 $ 758,359 (1) Includes $10.0 million and $10.1 million for the three-months ended June 30, 2023 and 2022, respectively, related to the recognition of deferred revenue. Includes $ 19.9 million and $ 20.1 million for the six-months ended June 30, 2023 and 2022, respectively, related to the recognition of deferred revenue. (2) For the six-months ended June 30, 2022, effectively from February 17, 2022 to June 30, 2022. Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Depreciation and amortization: Monster Energy® Drinks $ 8,817 $ 8,102 $ 17,806 $ 16,262 Strategic Brands 196 242 417 475 Alcohol Brands 4,106 3,683 8,157 5,966 Other 51 1,113 1,174 2,224 Corporate and unallocated 2,406 2,682 4,830 5,505 $ 15,576 $ 15,822 $ 32,384 $ 30,432 Corporate and unallocated expenses for the three-months ended June 30, 2023 include $82.6 million of payroll costs, of which $18.1 million was attributable to stock-based compensation expenses (see Note 14 “Stock-Based Compensation”), as well as $25.3 million attributable to professional service expenses, including accounting and legal costs, and $16.4 million of other operating expenses. Corporate and unallocated expenses for the three-months ended June 30, 2022 include $70.0 million of payroll costs, of which $16.0 million was attributable to stock-based compensation expenses (see Note 15 “Stock-Based Compensation”), as well as $16.9 million attributable to professional service expenses, including accounting and legal costs, and $19.7 million of other operating expenses. Corporate and unallocated expenses for the six-months ended June 30, 2023 include $162.9 million of payroll costs, of which $33.8 million was attributable to stock-based compensation expenses (see Note 14 “Stock-Based Compensation”), as well as $47.4 million attributable to professional service expenses, including accounting and legal costs, and $34.4 million of other operating expenses. Corporate and unallocated expenses for the six-months ended June 30, 2022 include $138.1 million of payroll costs, of which $32.2 million was attributable to stock-based compensation expenses (see Note 15 “Stock-Based Compensation”), as well as $43.3 million attributable to professional service expenses, including accounting and legal costs, and $33.7 million of other operating expenses. Coca-Cola Europacific Partners accounted for approximately 14% of the Company’s net sales for both the three-months ended June 30, 2023 and 2022. Coca-Cola Europacific Partners accounted for approximately 13% of the Company’s net sales for both the six-months ended June 30, 2023 and 2022. Coca-Cola Consolidated, Inc. accounted for approximately 10% and 11% of the Company’s net sales for the three-months ended June 30, 2023 and 2022, respectively. Coca-Cola Consolidated, Inc. accounted for approximately 10% of the Company’s net sales for both the six-months ended June 30, 2023 and 2022. Reyes Holdings, LLC accounted for approximately 10% and 9% of the Company’s net sales for the three-months ended June 30, 2023 and 2022, respectively. Reyes Holdings, LLC accounted for approximately 10% and 9% of the Company’s net sales for the six-months ended June 30, 2023 and 2022, respectively. Net sales to customers outside the United States amounted to $715.4 million and $649.0 million for the three-months ended June 30, 2023 and 2022, respectively. Such sales were approximately 39% of net sales for both the three-months ended June 30, 2023 and 2022. Net sales to customers outside the United States amounted to $1.34 billion and $1.20 billion for the six-months ended June 30, 2023 and 2022, respectively. Such sales were approximately 38% of net sales for both the six-months ended June 30, 2023 and 2022. Goodwill and other intangible assets for the Company’s reportable segments as of June 30, 2023 and December 31, 2022 were as follows: June 30, December 31, 2023 2022 Goodwill and other intangible assets: Monster Energy® Drinks $ 1,431,947 $ 1,424,212 Strategic Brands 981,570 979,896 Alcohol Brands 228,524 233,140 Other — 1,103 $ 2,642,041 $ 2,638,351 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2023 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | 18. RELATED PARTY TRANSACTIONS TCCC controls approximately 19.5% of the voting interests of the Company. The TCCC Subsidiaries, the TCCC Related Parties and certain TCCC independent bottlers/distributors purchase and distribute the Company’s products in domestic and certain international markets. The Company also pays TCCC a commission based on certain sales within the TCCC distribution network. TCCC commissions, based on sales to the TCCC Subsidiaries and the TCCC Related Parties, were $18.1 million and $10.1 million for the three-months ended June 30, 2023 and 2022, respectively, and are included as a reduction to net sales. TCCC commissions, based on sales to the TCCC Subsidiaries and the TCCC Related Parties, were $33.8 million and $28.5 million for the six-months ended June 30, 2023 and 2022, respectively, and are included as a reduction to net sales. TCCC commissions, based on sales to TCCC independent bottlers/distributors, were $8.1 million and $7.8 million for the three-months ended June 30, 2023 and 2022, respectively, and are included in operating expenses. TCCC commissions, based on sales to TCCC independent bottlers/distributors, were $16.9 million and $18.8 million for the six-months ended June 30, 2023 and 2022, respectively, and are included in operating expenses. Net sales to the TCCC Subsidiaries for the three-months ended June 30, 2023 and 2022 were $33.2 million and $26.5 million, respectively. Net sales to the TCCC Subsidiaries for the six-months ended June 30, 2023 and 2022 were $68.3 million and $58.3 million, respectively. The Company also purchases concentrates from TCCC, which are then sold to certain of the Company’s bottlers/distributors. Concentrate purchases from TCCC were $8.3 million and $6.5 million for the three-months ended June 30, 2023 and 2022, respectively. Concentrate purchases from TCCC were $14.8 million and $15.0 million for the six-months ended June 30, 2023 and 2022, respectively. Certain TCCC Subsidiaries also contract manufacture certain of the Company’s energy drinks. Such contract manufacturing expenses were $7.5 million and $4.8 million for the three-months ended June 30, 2023 and 2022, respectively. Such contract manufacturing expenses were $15.0 million and $14.0 million for the six-months ended June 30, 2023 and 2022, respectively. Accounts receivable, accounts payable, accrued promotional allowances and accrued liabilities related to the TCCC Subsidiaries were as follows at: June 30, December 31, 2023 2022 Accounts receivable, net $ 120,640 $ 88,169 Accounts payable $ (41,542) $ (35,467) Accrued promotional allowances $ (10,807) $ (11,222) Accrued liabilities $ (22,651) $ (14,733) One director of the Company through certain trusts, and a family member of one director are the principal owners of a company that provides promotional materials to the Company. Expenses incurred with such company in connection with promotional materials purchased during the three-months ended June 30, 2023 and 2022 was $1.0 million and $2.3 million, respectively. Expenses incurred with such company in connection with promotional materials purchased during the six-months ended June 30, 2023 and 2022 was $2.1 million and $3.4 million, respectively. The Company occasionally charters a private aircraft that is indirectly owned by Mr. Rodney C. Sacks, Co-Chief Executive Officer and Chairman of the Board of Directors. On certain occasions, Mr. Sacks is accompanied by guests and other Company personnel when using such aircraft for business travel. During the three-months ended June 30, 2023, the Company incurred costs of $0.03 million, amounts the Company believes is commensurate with market rates for comparable travel. No amounts were incurred during the three-months ended June 30, 2022. During the six-months ended June 30, 2023 and 2022, the Company incurred costs of $0.03 million and $0.08 million, respectively, amounts the Company believes is commensurate with market rates for comparable travel. In December 2018, the Company and a director of the Company entered into a 50-50 partnership that purchased land, and real property thereon, in Kona, Hawaii for the purpose of producing coffee products. This partnership meets the definition of a Variable Interest Entity (“VIE”) for which the Company has determined that it is the primary beneficiary. Therefore, the Company consolidates the VIE in the accompanying condensed consolidated financial statements. The aggregate carrying values of the VIE’s assets and liabilities, after elimination of any intercompany transactions and balances, as well as the results of operations for all periods presented, are not material to the Company’s condensed consolidated financial statements. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 19. SUBSEQUENT EVENTS On July 31, 2023, a subsidiary of the Company, Blast Asset Acquisition LLC, completed its acquisition of substantially all of the assets of Vital Pharmaceuticals, Inc. and its debtor affiliates (collectively, “Bang Energy”) for a purchase price of approximately $362.0 million in cash, subject to adjustments. The acquired assets include Bang Energy® drinks and a beverage production facility in Phoenix, AZ. |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
BASIS OF PRESENTATION | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements There have been no changes in recently issued or adopted accounting pronouncements that would materially impact the Company from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
REVENUE RECOGNITION | |
Schedule of disaggregation of revenue by geographical markets | Three-Months Ended June 30, 2023 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 1,068,887 $ 339,522 $ 138,478 $ 140,000 $ 1,686,887 Strategic Brands 47,226 42,050 7,828 2,586 99,690 Alcohol Brands 61,076 — — — 61,076 Other 7,308 — — — 7,308 Total Net Sales $ 1,184,497 $ 381,572 $ 146,306 $ 142,586 $ 1,854,961 Three-Months Ended June 30, 2022 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 973,674 $ 308,839 $ 116,788 $ 138,389 $ 1,537,690 Strategic Brands 38,368 29,171 7,477 4,126 79,142 Alcohol Brands 32,447 — — — 32,447 Other 5,981 — — — 5,981 Total Net Sales $ 1,050,470 $ 338,010 $ 124,265 $ 142,515 $ 1,655,260 1 Europe, Middle East and Africa (“EMEA”) Six-Months Ended June 30, 2023 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 2,090,215 $ 616,633 $ 260,472 $ 281,235 $ 3,248,555 Strategic Brands 90,269 73,001 16,811 5,967 186,048 Alcohol Brands 107,366 — — — 107,366 Other 11,922 — — — 11,922 Total Net Sales $ 2,299,772 $ 689,634 $ 277,283 $ 287,202 $ 3,553,891 Six-Months Ended June 30, 2022 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 1,899,354 $ 569,728 $ 227,343 $ 246,111 $ 2,942,536 Strategic Brands 91,420 59,347 14,138 6,830 171,735 Alcohol Brands 2 47,654 — — — 47,654 Other 11,908 — — — 11,908 Total Net Sales $ 2,050,336 $ 629,075 $ 241,481 $ 252,941 $ 3,173,833 1 Europe, Middle East and Africa (“EMEA”) 2 Effectively from February 17, 2022 to June 30, 2022 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
LEASES | |
Schedule of lease cost | Three-Months Ended June 30, Six-Months Ended June 30, 2023 2022 2023 2022 Operating lease cost $ 2,616 $ 2,238 $ 5,083 $ 3,932 Short-term lease cost 1,070 939 2,049 1,869 Variable lease cost 226 195 441 378 Finance leases: Amortization of right-of-use assets 202 148 325 275 Interest on lease liabilities 44 7 58 10 Finance lease cost 246 155 383 285 Total lease cost $ 4,158 $ 3,527 $ 7,956 $ 6,464 |
Schedule of supplemental cash flow information related to leases | Six-Months Ended June 30, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 4,818 $ 3,682 Operating cash outflows from finance leases 58 10 Financing cash outflows from finance leases 1,683 1,179 Right-of-use assets obtained in exchange for lease obligations: Finance leases 5,115 1,561 Operating leases 1,847 18,339 |
Schedule of ROU assets for operating and finance leases | June 30, December 31, Balance Sheet Location 2023 2022 Operating leases: Right-of-use assets Other assets $ 37,111 $ 38,012 Current lease liabilities Accrued liabilities $ 7,835 $ 7,747 Noncurrent lease liabilities Other liabilities 28,829 29,586 Total operating lease liabilities $ 36,664 $ 37,333 Finance leases: Right-of-use assets Property and equipment, net $ 5,335 $ 1,598 Current lease liabilities Accrued liabilities $ 4,205 $ 757 Noncurrent lease liabilities Other liabilities 29 41 Total finance lease liabilities $ 4,234 $ 798 |
Schedule of weighted-average remaining lease terms and weighted-average discount rates | June 30, 2023 December 31, 2022 Weighted-average remaining lease term in years: Operating leases 6.5 6.7 Finance leases 0.8 0.8 Weighted-average discount rate: Operating leases 3.6 % 3.4 % Finance leases 5.9 % 3.6 % |
Schedule of outlines maturities of the Company's lease liabilities | Operating Leases Finance Leases 2023 (from July 1, 2023 to December 31, 2023) $ 4,592 $ 2,711 2024 8,089 1,620 2025 5,962 17 2026 4,780 2 2027 4,650 — 2028 and thereafter 13,183 — Total lease payments 41,256 4,350 Less imputed interest (4,592) (116) Total $ 36,664 $ 4,234 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
INVESTMENTS | |
Summary of investments in available-for-sale | Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 June 30, 2023 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 329,770 $ — $ 2 $ 329,768 $ 2 $ — Certificates of deposit 15,161 — — 15,161 — — Municipal securities 59,158 — 125 59,033 125 — U.S. government agency securities 152,071 — 489 151,582 489 — U.S. treasuries 705,370 31 2,002 703,399 2,002 — Corporate bonds 158,748 10 462 158,296 462 — Long-term: U.S. government agency securities 2,580 — 9 2,571 9 — U.S. treasuries 39,011 — 309 38,702 309 — Corporate bonds 21,065 — 90 20,975 90 — Total $ 1,482,934 $ 41 $ 3,488 $ 1,479,487 $ 3,488 $ — Continuous Continuous Gross Gross Unrealized Unrealized Unrealized Unrealized Loss Position Loss Position Amortized Holding Holding Fair less than 12 greater than 12 December 31, 2022 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 197,712 $ 1 $ 4 $ 197,709 $ 4 $ — Certificates of deposit 10,078 — — 10,078 — — Municipal securities 211,791 60 612 211,239 612 — U.S. government agency securities 109,697 3 715 108,985 715 — U.S. treasuries 838,825 17 4,539 834,303 4,539 — Long-term: U.S. government agency securities 2,016 — 3 2,013 3 — U.S. treasuries 53,215 20 71 53,164 71 — Variable rate demand notes 6,266 — — 6,266 — — Total $ 1,429,600 $ 101 $ 5,944 $ 1,423,757 $ 5,944 $ — |
Summary of the underlying contractual maturities of investments | June 30, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value Less than 1 year: Commercial paper $ 329,770 $ 329,768 $ 197,712 $ 197,710 Municipal securities 59,158 59,033 211,791 211,239 U.S. government agency securities 152,071 151,582 109,697 108,985 Certificates of deposit 15,161 15,161 10,078 10,078 U.S. treasuries 705,370 703,399 838,825 834,302 Corporate bonds 158,748 158,296 — — Due 1 - 10 years: U.S. treasuries 39,011 38,702 53,215 53,164 U.S. government agency securities 2,580 2,571 2,016 2,013 Variable rate demand notes — — 4,862 4,862 Corporate bonds 21,065 20,975 — — Due 11 - 20 years: Variable rate demand notes — — 1,404 1,404 Total $ 1,482,934 $ 1,479,487 $ 1,429,600 $ 1,423,757 |
FAIR VALUE OF CERTAIN FINANCI_2
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |
Schedule of financial assets and liabilities recorded at fair value on a recurring basis | June 30, 2023 Level 1 Level 2 Level 3 Total Cash $ 877,582 $ — $ — $ 877,582 Money market funds 911,446 — — 911,446 Certificates of deposit — 47,109 — 47,109 Commercial paper — 336,764 — 336,764 Corporate bonds — 179,271 — 179,271 Municipal securities — 59,033 — 59,033 U.S. government agency securities — 162,351 — 162,351 U.S. treasuries — 775,707 — 775,707 Foreign currency derivatives — 178 — 178 Commodity derivatives — (1,266) — (1,266) Total $ 1,789,028 $ 1,559,147 $ — $ 3,348,175 Amounts included in: Cash and cash equivalents $ 1,789,028 $ 80,746 $ — $ 1,869,774 Short-term investments — 1,417,239 — 1,417,239 Accounts receivable, net — 270 — 270 Investments — 62,248 — 62,248 Accrued liabilities — (1,219) — (1,219) Other liabilities — (137) — (137) Total $ 1,789,028 $ 1,559,147 $ — $ 3,348,175 December 31, 2022 Level 1 Level 2 Level 3 Total Cash $ 1,132,509 $ — $ — $ 1,132,509 Money market funds 121,444 — — 121,444 Certificates of deposit — 10,078 — 10,078 Commercial paper — 225,067 — 225,067 Variable rate demand notes — 6,266 — 6,266 Municipal securities — 213,798 — 213,798 U.S. government agency securities — 113,357 — 113,357 U.S. treasuries — 908,379 — 908,379 Foreign currency derivatives — (3,733) — (3,733) Total $ 1,253,953 $ 1,473,212 $ — $ 2,727,165 Amounts included in: Cash and cash equivalents $ 1,253,953 $ 53,188 $ — $ 1,307,141 Short-term investments — 1,362,314 — 1,362,314 Accounts receivable, net — 965 — 965 Investments — 61,443 — 61,443 Accrued liabilities — (4,698) — (4,698) Total $ 1,253,953 $ 1,473,212 $ — $ 2,727,165 |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
Schedule of fair value of derivative instrument | Fair value June 30, December 31, Derivatives designated as hedging instruments 2023 2022 Balance Sheet location Assets: Commodity contracts $ — $ — Accounts receivable, net Liabilities: Commodity contracts $ (1,129) $ — Accrued liabilities Commodity contracts $ (137) $ — Other liabilities Fair value June 30, December 31, Derivatives not designated as hedging instruments 2023 2022 Balance Sheet location Assets: Foreign currency exchange contracts $ 270 $ 965 Accounts receivable, net Liabilities: Foreign currency exchange contracts $ (92) $ (4,698) Accrued liabilities |
Schedule of changes in the fair values of derivatives designated as cash flow hedges had on other comprehensive income ("OCI"), AOCI and earnings | Three-months ended June 30, 2023 Derivatives Gain (loss) designated as Gain (loss) recognized Location of gain (loss) reclassified from hedging instruments in AOCI recognized in income AOCI into income Commodity contracts $ (1,266) Cost of sales $ — Six-months ended June 30, 2023 Derivatives Gain (loss) designated as Gain (loss) recognized Location of gain (loss) reclassified from hedging instruments in AOCI recognized in income AOCI into income Commodity contracts $ (1,266) Cost of sales $ — |
Schedule of net loss on derivative instruments in the consolidated statements of income | Gain (loss) recognized in income on derivatives Three-months ended Derivatives not designated as Location of gain (loss) June 30, June 30, hedging instruments recognized in income on derivatives 2023 2022 Foreign currency exchange contracts Interest and other income (expense), net $ (1,924) $ 743 Gain (loss) recognized in income on derivatives Six-months ended Derivatives not designated as Location of gain (loss) June 30, June 30, hedging instruments recognized in income on derivatives 2023 2022 Foreign currency exchange contracts Interest and other income (expense), net $ (9,775) $ (3,275) |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
INVENTORIES | |
Schedule of inventories | June 30, December 31, 2023 2022 Raw materials $ 399,564 $ 467,392 Work in process 1,848 1,688 Finished goods 445,400 466,551 $ 846,812 $ 935,631 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of property and equipment | June 30, December 31, 2023 2022 Land $ 139,975 $ 139,798 Leasehold improvements 33,245 31,327 Furniture and fixtures 9,393 9,286 Office and computer equipment 23,326 22,386 Computer software 4,941 5,906 Equipment 269,671 244,739 Buildings 165,598 163,885 Vehicles 57,162 49,175 Assets under construction 133,086 83,553 836,397 750,055 Less: accumulated depreciation and amortization (259,752) (233,158) $ 576,645 $ 516,897 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Schedule of goodwill | Monster Energy® Strategic Alcohol Drinks Brands Brands Other Total Balance at December 31, 2022 $ 693,644 $ 637,999 $ 86,298 $ — $ 1,417,941 Acquisitions — — — — — Balance at June 30, 2023 $ 693,644 $ 637,999 $ 86,298 $ — $ 1,417,941 Monster Energy® Strategic Alcohol Drinks Brands Brands Other Total Balance at December 31, 2021 $ 693,644 $ 637,999 $ — $ — $ 1,331,643 Acquisitions — — 81,298 — 81,298 Balance at June 30, 2022 $ 693,644 $ 637,999 $ 81,298 $ — $ 1,412,941 |
Schedule of intangible assets | June 30, December 31, 2023 2022 Amortizing intangibles $ 121,378 $ 121,378 Accumulated amortization (71,712) (68,790) 49,666 52,588 Non-amortizing intangibles 1,174,434 1,167,822 $ 1,224,100 $ 1,220,410 |
Schedule of future estimated amortization expense related to amortizing intangibles | 2023 (from July 1, 2023 to December 31, 2023) $ 1,824 2024 3,648 2025 3,647 2026 3,647 2027 3,646 2028 and thereafter 33,254 $ 49,666 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | |
Schedule of components of accumulated other comprehensive loss | Accumulated Unrealized Net Losses on Currency Gains (Losses) Commodity Translation on Available-for- Derivatives Gains (Losses) Sale Securities Total Balance at December 31, 2022 $ — $ (153,230) $ (5,843) $ (159,073) Other comprehensive income before reclassifications (1,266) 2,206 2,408 3,348 Net current-period other comprehensive (loss) gain (1,266) 2,206 2,408 3,348 Balance at June 30, 2023 $ (1,266) $ (151,024) $ (3,435) $ (155,725) Accumulated Unrealized Net Losses on Currency Losses Commodity Translation on Available-for- Derivatives Losses Sale Securities Total Balance at December 31, 2021 $ — $ (68,209) $ (956) $ (69,165) Other comprehensive loss before reclassifications — (78,628) (5,164) (83,792) Net current-period other comprehensive loss — (78,628) (5,164) (83,792) Balance at June 30, 2022 $ — $ (146,837) $ (6,120) $ (152,957) |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
STOCK-BASED COMPENSATION | |
Schedule of weighted-average assumptions used to estimate the fair value of options granted | Three-Months Ended June 30, Six-Months Ended June 30, 2023 2022 2023 2022 Dividend yield 0.0 % 0.0 % 0.0 % 0.0 % Expected volatility 27.4 % 27.8 % 27.6 % 27.7 % Risk-free interest rate 3.7 % 3.0 % 3.7 % 2.1 % Expected term 6.3 years 6.2 years 6.3 years 6.0 years |
Summary of activities with respect to its stock option plans | Weighted- Weighted- Average Average Remaining Number of Exercise Contractual Shares (in Price Per Term (in Aggregate Options thousands) Share years) Intrinsic Value Outstanding at January 1, 2023 29,710 $ 26.38 5.0 $ 724,651 Granted 01/01/23 - 03/31/23 3,962 $ 50.82 Granted 04/01/23 - 06/30/23 31 $ 59.36 Exercised (3,990) $ 14.95 Cancelled or forfeited (222) $ 37.82 Outstanding at June 30, 2023 29,491 $ 31.15 5.6 $ 775,296 Vested and expected to vest in the future at June 30, 2023 28,511 $ 30.71 5.4 $ 762,069 Exercisable at June 30, 2023 18,659 $ 24.70 3.8 $ 610,938 |
Summary of activities with respect to non-vested restricted stock units and performance share units | Weighted Number of Average Shares (in Grant-Date thousands) Fair Value Non-vested at January 1, 2023 2,026 $ 36.27 Granted 01/01/23 - 03/31/23 1 523 $ 48.49 Granted 04/01/23 - 06/30/23 22 $ 59.70 Vested (592) $ 32.80 Forfeited/cancelled (11) $ 32.83 Non-vested at June 30, 2023 1,968 $ 40.85 1 The grant activity for performance share units is recorded based on the target performance level earning 100% of target performance share units. The actual number of performance share units earned could range from 0% to 200% of target depending on the achievement of pre-established performance goals. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
INCOME TAXES | |
Schedule of roll-forward of the total gross unrecognized tax benefits, not including interest and penalties | Gross Unrecognized Tax Benefits Balance at December 31, 2022 $ 3,020 Additions for tax positions related to the current year — Additions for tax positions related to the prior years 738 Decreases for tax positions related to the prior years — Balance at June 30, 2023 $ 3,758 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
EARNINGS PER SHARE | |
Schedule of reconciliation of the weighted average shares used in the basic and diluted earnings per common share | A reconciliation of the weighted-average shares used in the basic and diluted earnings per common share computations is presented below (in thousands): Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Weighted-average shares outstanding: Basic 1,047,065 1,057,233 1,045,993 1,058,017 Dilutive 13,028 12,389 13,674 12,401 Diluted 1,060,093 1,069,622 1,059,667 1,070,418 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
SEGMENT INFORMATION | |
Schedule of net revenues and other financial information by segment | Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Net sales: Monster Energy® Drinks 1 $ 1,686,887 $ 1,537,690 $ 3,248,555 $ 2,942,536 Strategic Brands 99,690 79,142 186,048 171,735 Alcohol Brands 2 61,076 32,447 107,366 47,654 Other 7,308 5,981 11,922 11,908 Corporate and unallocated — — — — $ 1,854,961 $ 1,655,260 $ 3,553,891 $ 3,173,833 Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Operating Income: Monster Energy® Drinks 1 $ 597,922 $ 441,719 $ 1,158,740 $ 896,282 Strategic Brands 55,137 41,500 106,909 98,695 Alcohol Brands 2 (6,577) (4,657) (13,460) (9,611) Other 1,651 1,034 1,358 2,161 Corporate and unallocated (124,328) (106,645) (244,677) (215,088) $ 523,805 $ 372,951 $ 1,008,870 $ 772,439 Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Income before tax: Monster Energy® Drinks 1 $ 598,656 $ 442,407 $ 1,160,330 $ 897,540 Strategic Brands 55,149 41,509 106,938 98,763 Alcohol Brands 2 (6,584) (3,890) (13,451) (9,496) Other 1,657 1,025 1,364 2,162 Corporate and unallocated (109,914) (114,881) (218,658) (230,610) $ 538,964 $ 366,170 $ 1,036,523 $ 758,359 (1) Includes $10.0 million and $10.1 million for the three-months ended June 30, 2023 and 2022, respectively, related to the recognition of deferred revenue. Includes $ 19.9 million and $ 20.1 million for the six-months ended June 30, 2023 and 2022, respectively, related to the recognition of deferred revenue. (2) For the six-months ended June 30, 2022, effectively from February 17, 2022 to June 30, 2022. Three-Months Ended Six-Months Ended June 30, June 30, 2023 2022 2023 2022 Depreciation and amortization: Monster Energy® Drinks $ 8,817 $ 8,102 $ 17,806 $ 16,262 Strategic Brands 196 242 417 475 Alcohol Brands 4,106 3,683 8,157 5,966 Other 51 1,113 1,174 2,224 Corporate and unallocated 2,406 2,682 4,830 5,505 $ 15,576 $ 15,822 $ 32,384 $ 30,432 |
Schedule of goodwill and other intangible assets for the reportable segments | June 30, December 31, 2023 2022 Goodwill and other intangible assets: Monster Energy® Drinks $ 1,431,947 $ 1,424,212 Strategic Brands 981,570 979,896 Alcohol Brands 228,524 233,140 Other — 1,103 $ 2,642,041 $ 2,638,351 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party transactions | June 30, December 31, 2023 2022 Accounts receivable, net $ 120,640 $ 88,169 Accounts payable $ (41,542) $ (35,467) Accrued promotional allowances $ (10,807) $ (11,222) Accrued liabilities $ (22,651) $ (14,733) |
BASIS OF PRESENTATION (Details)
BASIS OF PRESENTATION (Details) shares in Millions, $ in Millions | Mar. 10, 2023 USD ($) shares | Feb. 28, 2023 |
BASIS OF PRESENTATION | ||
Stock split ratio | 2 | |
Stock dividend (in percent) | 100% | |
Treasury stock | ||
BASIS OF PRESENTATION | ||
Number of shares retired | shares | 170 | |
Carrying value of shares retired | $ | $ 4,690 |
REVENUE RECOGNITION - (Details)
REVENUE RECOGNITION - (Details) | 6 Months Ended |
Jun. 30, 2023 segment | |
REVENUE RECOGNITION | |
Number of operating segments | 4 |
Distribution agreement, revenue recognition period | 20 years |
REVENUE RECOGNITION - Disaggreg
REVENUE RECOGNITION - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
REVENUE RECOGNITION | ||||
Net sales | $ 1,854,961 | $ 1,655,260 | $ 3,553,891 | $ 3,173,833 |
U.S. and Canada | ||||
REVENUE RECOGNITION | ||||
Net sales | 1,184,497 | 1,050,470 | 2,299,772 | 2,050,336 |
EMEA | ||||
REVENUE RECOGNITION | ||||
Net sales | 381,572 | 338,010 | 689,634 | 629,075 |
Asia Pacific | ||||
REVENUE RECOGNITION | ||||
Net sales | 146,306 | 124,265 | 277,283 | 241,481 |
Latin America and Caribbean | ||||
REVENUE RECOGNITION | ||||
Net sales | 142,586 | 142,515 | 287,202 | 252,941 |
Monster Energy Drinks | ||||
REVENUE RECOGNITION | ||||
Net sales | 1,686,887 | 1,537,690 | 3,248,555 | 2,942,536 |
Monster Energy Drinks | U.S. and Canada | ||||
REVENUE RECOGNITION | ||||
Net sales | 1,068,887 | 973,674 | 2,090,215 | 1,899,354 |
Monster Energy Drinks | EMEA | ||||
REVENUE RECOGNITION | ||||
Net sales | 339,522 | 308,839 | 616,633 | 569,728 |
Monster Energy Drinks | Asia Pacific | ||||
REVENUE RECOGNITION | ||||
Net sales | 138,478 | 116,788 | 260,472 | 227,343 |
Monster Energy Drinks | Latin America and Caribbean | ||||
REVENUE RECOGNITION | ||||
Net sales | 140,000 | 138,389 | 281,235 | 246,111 |
Strategic Brands | ||||
REVENUE RECOGNITION | ||||
Net sales | 99,690 | 79,142 | 186,048 | 171,735 |
Strategic Brands | U.S. and Canada | ||||
REVENUE RECOGNITION | ||||
Net sales | 47,226 | 38,368 | 90,269 | 91,420 |
Strategic Brands | EMEA | ||||
REVENUE RECOGNITION | ||||
Net sales | 42,050 | 29,171 | 73,001 | 59,347 |
Strategic Brands | Asia Pacific | ||||
REVENUE RECOGNITION | ||||
Net sales | 7,828 | 7,477 | 16,811 | 14,138 |
Strategic Brands | Latin America and Caribbean | ||||
REVENUE RECOGNITION | ||||
Net sales | 2,586 | 4,126 | 5,967 | 6,830 |
Alcohol Brands | ||||
REVENUE RECOGNITION | ||||
Net sales | 61,076 | 32,447 | 107,366 | 47,654 |
Alcohol Brands | U.S. and Canada | ||||
REVENUE RECOGNITION | ||||
Net sales | 61,076 | 32,447 | 107,366 | 47,654 |
Alcohol Brands | EMEA | ||||
REVENUE RECOGNITION | ||||
Net sales | 0 | 0 | 0 | 0 |
Alcohol Brands | Asia Pacific | ||||
REVENUE RECOGNITION | ||||
Net sales | 0 | 0 | 0 | 0 |
Alcohol Brands | Latin America and Caribbean | ||||
REVENUE RECOGNITION | ||||
Net sales | 0 | 0 | 0 | 0 |
Other | ||||
REVENUE RECOGNITION | ||||
Net sales | 7,308 | 5,981 | 11,922 | 11,908 |
Other | U.S. and Canada | ||||
REVENUE RECOGNITION | ||||
Net sales | 7,308 | 5,981 | 11,922 | 11,908 |
Other | EMEA | ||||
REVENUE RECOGNITION | ||||
Net sales | 0 | 0 | 0 | 0 |
Other | Asia Pacific | ||||
REVENUE RECOGNITION | ||||
Net sales | 0 | 0 | 0 | 0 |
Other | Latin America and Caribbean | ||||
REVENUE RECOGNITION | ||||
Net sales | $ 0 | $ 0 | $ 0 | $ 0 |
REVENUE RECOGNITION - Contract
REVENUE RECOGNITION - Contract Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Contract Liabilities | |||||
Deferred revenue | $ 257.8 | $ 257.8 | $ 267.1 | ||
Deferred revenue recognized in net sales | $ 10 | $ 10.1 | $ 19.9 | $ 20.1 |
LEASES - Lease Terms (Details)
LEASES - Lease Terms (Details) | 6 Months Ended |
Jun. 30, 2023 | |
LEASES | |
Operating leases, options to extend | true |
Finance leases, options to extend | true |
Operating leases, options to terminate | true |
Finance leases, options to terminate | true |
Minimum | |
LEASES | |
Operating leases, lease term (in years) | 1 year |
Finance leases, lease term (in years) | 1 year |
Maximum | |
LEASES | |
Operating leases, lease term (in years) | 11 years |
Finance leases, lease term (in years) | 11 years |
Operating leases, renewal lease term (in years) | 5 years |
Finance leases, renewal lease term (in years) | 5 years |
Operating leases, termination period (in years) | 1 year |
Finance leases, termination period (in years) | 1 year |
LEASES - Lease Cost (Details)
LEASES - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
LEASES | ||||
Operating lease cost | $ 2,616 | $ 2,238 | $ 5,083 | $ 3,932 |
Short-term lease cost | 1,070 | 939 | 2,049 | 1,869 |
Variable lease cost | 226 | 195 | 441 | 378 |
Finance leases: | ||||
Amortization of right-of-use assets | 202 | 148 | 325 | 275 |
Interest on lease liabilities | 44 | 7 | 58 | 10 |
Finance lease cost | 246 | 155 | 383 | 285 |
Total lease cost | $ 4,158 | $ 3,527 | $ 7,956 | $ 6,464 |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash outflows from operating leases | $ 4,818 | $ 3,682 |
Operating cash outflows from finance leases | 58 | 10 |
Financing cash outflows from finance leases | 1,683 | 1,179 |
Right-of-use assets obtained in exchange for lease obligations: | ||
Finance leases | 5,115 | 1,561 |
Operating leases | $ 1,847 | $ 18,339 |
LEASES - Supplemental balance s
LEASES - Supplemental balance sheet information (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Operating leases: | ||
Right-of-use assets | $ 37,111 | $ 38,012 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets, Noncurrent | Other Assets, Noncurrent |
Current lease liabilities | $ 7,835 | $ 7,747 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued Liabilities, Current | Accrued Liabilities, Current |
Noncurrent lease liabilities | $ 28,829 | $ 29,586 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Total operating lease liabilities | $ 36,664 | $ 37,333 |
Finance leases: | ||
Right-of-use assets | $ 5,335 | $ 1,598 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant and Equipment, Net | Property, Plant and Equipment, Net |
Current lease liabilities | $ 4,205 | $ 757 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued Liabilities, Current | Accrued Liabilities, Current |
Noncurrent lease liabilities | $ 29 | $ 41 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
Total finance lease liabilities | $ 4,234 | $ 798 |
LEASES - Weighted-average remai
LEASES - Weighted-average remaining lease term and weighted-average discount rate (Details) | Jun. 30, 2023 | Dec. 31, 2022 |
LEASES | ||
Weighted-average remaining lease term (years), Operating Leases | 6 years 6 months | 6 years 8 months 12 days |
Weighted-average remaining lease term (years), Finance Leases | 9 months 18 days | 9 months 18 days |
Weighted-average discount rate, Operating Leases | 3.60% | 3.40% |
Weighted-average discount rate, Finance Leases | 5.90% | 3.60% |
LEASES - Undiscounted future le
LEASES - Undiscounted future lease payments for operating and finance leases (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Operating Leases | ||
2023 (from July 1, 2023 to December 31, 2023) | $ 4,592 | |
2024 | 8,089 | |
2025 | 5,962 | |
2026 | 4,780 | |
2027 | 4,650 | |
2028 and thereafter | 13,183 | |
Total lease payments | 41,256 | |
Less imputed interest | (4,592) | |
Total operating lease liabilities | 36,664 | $ 37,333 |
Finance Leases | ||
2023 (from July 1, 2023 to December 31, 2023) | 2,711 | |
2024 | 1,620 | |
2025 | 17 | |
2026 | 2 | |
2027 | 0 | |
2028 and thereafter | 0 | |
Total lease payments | 4,350 | |
Less imputed interest | (116) | |
Total finance lease liabilities | $ 4,234 | $ 798 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued Liabilities, Current | Accrued Liabilities, Current |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Available-for-sale | ||
Amortized Cost | $ 1,482,934 | $ 1,429,600 |
Gross Unrealized Holding Gains | 41 | 101 |
Gross Unrealized Holding Losses | 3,488 | 5,944 |
Fair Value | 1,479,487 | 1,423,757 |
Continuous Unrealized Loss Position less than 12 Months | 3,488 | 5,944 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Short-term | Commercial paper | ||
Available-for-sale | ||
Amortized Cost | 329,770 | 197,712 |
Gross Unrealized Holding Gains | 0 | 1 |
Gross Unrealized Holding Losses | 2 | 4 |
Fair Value | 329,768 | 197,709 |
Continuous Unrealized Loss Position less than 12 Months | 2 | 4 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Short-term | Certificates of deposit | ||
Available-for-sale | ||
Amortized Cost | 15,161 | 10,078 |
Gross Unrealized Holding Gains | 0 | 0 |
Gross Unrealized Holding Losses | 0 | 0 |
Fair Value | 15,161 | 10,078 |
Continuous Unrealized Loss Position less than 12 Months | 0 | 0 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Short-term | Municipal securities | ||
Available-for-sale | ||
Amortized Cost | 59,158 | 211,791 |
Gross Unrealized Holding Gains | 0 | 60 |
Gross Unrealized Holding Losses | 125 | 612 |
Fair Value | 59,033 | 211,239 |
Continuous Unrealized Loss Position less than 12 Months | 125 | 612 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Short-term | U.S. government agency securities | ||
Available-for-sale | ||
Amortized Cost | 152,071 | 109,697 |
Gross Unrealized Holding Gains | 0 | 3 |
Gross Unrealized Holding Losses | 489 | 715 |
Fair Value | 151,582 | 108,985 |
Continuous Unrealized Loss Position less than 12 Months | 489 | 715 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Short-term | U.S. treasuries | ||
Available-for-sale | ||
Amortized Cost | 705,370 | 838,825 |
Gross Unrealized Holding Gains | 31 | 17 |
Gross Unrealized Holding Losses | 2,002 | 4,539 |
Fair Value | 703,399 | 834,303 |
Continuous Unrealized Loss Position less than 12 Months | 2,002 | 4,539 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Short-term | Corporate bonds | ||
Available-for-sale | ||
Amortized Cost | 158,748 | |
Gross Unrealized Holding Gains | 10 | |
Gross Unrealized Holding Losses | 462 | |
Fair Value | 158,296 | |
Continuous Unrealized Loss Position less than 12 Months | 462 | |
Continuous Unrealized Loss Position greater than 12 Months | 0 | |
Long-term | U.S. government agency securities | ||
Available-for-sale | ||
Amortized Cost | 2,580 | 2,016 |
Gross Unrealized Holding Gains | 0 | 0 |
Gross Unrealized Holding Losses | 9 | 3 |
Fair Value | 2,571 | 2,013 |
Continuous Unrealized Loss Position less than 12 Months | 9 | 3 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Long-term | U.S. treasuries | ||
Available-for-sale | ||
Amortized Cost | 39,011 | 53,215 |
Gross Unrealized Holding Gains | 0 | 20 |
Gross Unrealized Holding Losses | 309 | 71 |
Fair Value | 38,702 | 53,164 |
Continuous Unrealized Loss Position less than 12 Months | 309 | 71 |
Continuous Unrealized Loss Position greater than 12 Months | 0 | 0 |
Long-term | Corporate bonds | ||
Available-for-sale | ||
Amortized Cost | 21,065 | |
Gross Unrealized Holding Gains | 0 | |
Gross Unrealized Holding Losses | 90 | |
Fair Value | 20,975 | |
Continuous Unrealized Loss Position less than 12 Months | 90 | |
Continuous Unrealized Loss Position greater than 12 Months | $ 0 | |
Long-term | Variable rate demand notes | ||
Available-for-sale | ||
Amortized Cost | 6,266 | |
Gross Unrealized Holding Gains | 0 | |
Gross Unrealized Holding Losses | 0 | |
Fair Value | 6,266 | |
Continuous Unrealized Loss Position less than 12 Months | 0 | |
Continuous Unrealized Loss Position greater than 12 Months | $ 0 |
INVESTMENTS - Maturity Period (
INVESTMENTS - Maturity Period (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
INVESTMENTS | ||
Amortized Cost | $ 1,482,934 | $ 1,429,600 |
Fair Value | 1,479,487 | 1,423,757 |
Commercial paper | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 329,770 | 197,712 |
Fair Value | 329,768 | 197,710 |
Municipal securities | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 59,158 | 211,791 |
Fair Value | 59,033 | 211,239 |
U.S. government agency securities | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 152,071 | 109,697 |
Fair Value | 151,582 | 108,985 |
U.S. government agency securities | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 2,580 | 2,016 |
Fair Value | 2,571 | 2,013 |
Certificates of deposit | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 15,161 | 10,078 |
Fair Value | 15,161 | 10,078 |
U.S. treasuries | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 705,370 | 838,825 |
Fair Value | 703,399 | 834,302 |
U.S. treasuries | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 39,011 | 53,215 |
Fair Value | 38,702 | 53,164 |
Corporate bonds | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 158,748 | 0 |
Fair Value | 158,296 | 0 |
Corporate bonds | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 21,065 | 0 |
Fair Value | 20,975 | 0 |
Variable rate demand notes | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 0 | 4,862 |
Fair Value | 0 | 4,862 |
Variable rate demand notes | Due 11 - 20 years | ||
INVESTMENTS | ||
Amortized Cost | 0 | 1,404 |
Fair Value | $ 0 | $ 1,404 |
FAIR VALUE OF CERTAIN FINANCI_3
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Net losses on commodity derivatives | $ (1,266) | $ 0 | $ (1,266) | $ 0 | |
Cash and cash equivalents | 1,869,774 | 1,869,774 | $ 1,307,141 | ||
Short-term investments | 1,417,239 | 1,417,239 | 1,362,314 | ||
Investments | 62,248 | 62,248 | 61,443 | ||
Asset transfers between Level 1 and Level 2 measurements | 0 | 0 | |||
Total fair value | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Cash | 877,582 | 877,582 | 1,132,509 | ||
Assets measured at fair value | 3,348,175 | 3,348,175 | 2,727,165 | ||
Foreign currency derivatives | 178 | 178 | (3,733) | ||
Cash and cash equivalents | 1,869,774 | 1,869,774 | 1,307,141 | ||
Short-term investments | 1,417,239 | 1,417,239 | 1,362,314 | ||
Accounts receivable, net | 270 | 270 | 965 | ||
Investments | 62,248 | 62,248 | 61,443 | ||
Accrued liabilities | (1,219) | (1,219) | (4,698) | ||
Other liabilities | (137) | (137) | |||
Total fair value | Money market funds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 911,446 | 911,446 | 121,444 | ||
Total fair value | Certificates of deposit | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 47,109 | 47,109 | 10,078 | ||
Total fair value | Commercial paper | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 336,764 | 336,764 | 225,067 | ||
Total fair value | Corporate bonds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 179,271 | 179,271 | |||
Total fair value | Municipal securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 59,033 | 59,033 | 213,798 | ||
Total fair value | U.S. government agency securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 162,351 | 162,351 | 113,357 | ||
Total fair value | U.S. treasuries | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 775,707 | 775,707 | 908,379 | ||
Total fair value | Variable rate demand notes | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 6,266 | ||||
Total fair value | Commodity contracts | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Foreign currency derivatives | (1,266) | (1,266) | |||
Level 1 | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Cash | 877,582 | 877,582 | 1,132,509 | ||
Assets measured at fair value | 1,789,028 | 1,789,028 | 1,253,953 | ||
Foreign currency derivatives | 0 | 0 | 0 | ||
Cash and cash equivalents | 1,789,028 | 1,789,028 | 1,253,953 | ||
Short-term investments | 0 | 0 | 0 | ||
Accounts receivable, net | 0 | 0 | 0 | ||
Investments | 0 | 0 | 0 | ||
Accrued liabilities | 0 | 0 | 0 | ||
Level 1 | Money market funds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 911,446 | 911,446 | 121,444 | ||
Level 1 | Certificates of deposit | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 1 | Commercial paper | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 1 | Corporate bonds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | |||
Level 1 | Municipal securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 1 | U.S. government agency securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 1 | U.S. treasuries | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 1 | Variable rate demand notes | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | ||||
Level 2 | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Cash | 0 | 0 | 0 | ||
Assets measured at fair value | 1,559,147 | 1,559,147 | 1,473,212 | ||
Foreign currency derivatives | 178 | 178 | (3,733) | ||
Cash and cash equivalents | 80,746 | 80,746 | 53,188 | ||
Short-term investments | 1,417,239 | 1,417,239 | 1,362,314 | ||
Accounts receivable, net | 270 | 270 | 965 | ||
Investments | 62,248 | 62,248 | 61,443 | ||
Accrued liabilities | (1,219) | (1,219) | (4,698) | ||
Other liabilities | (137) | (137) | |||
Level 2 | Money market funds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 2 | Certificates of deposit | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 47,109 | 47,109 | 10,078 | ||
Level 2 | Commercial paper | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 336,764 | 336,764 | 225,067 | ||
Level 2 | Corporate bonds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 179,271 | 179,271 | |||
Level 2 | Municipal securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 59,033 | 59,033 | 213,798 | ||
Level 2 | U.S. government agency securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 162,351 | 162,351 | 113,357 | ||
Level 2 | U.S. treasuries | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 775,707 | 775,707 | 908,379 | ||
Level 2 | Variable rate demand notes | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 6,266 | ||||
Level 2 | Commodity contracts | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Foreign currency derivatives | (1,266) | (1,266) | |||
Level 3 | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Cash | 0 | 0 | 0 | ||
Assets measured at fair value | 0 | 0 | 0 | ||
Foreign currency derivatives | 0 | 0 | 0 | ||
Cash and cash equivalents | 0 | 0 | 0 | ||
Short-term investments | 0 | 0 | 0 | ||
Accounts receivable, net | 0 | 0 | 0 | ||
Investments | 0 | 0 | 0 | ||
Accrued liabilities | 0 | 0 | 0 | ||
Level 3 | Money market funds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 3 | Certificates of deposit | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 3 | Commercial paper | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 3 | Corporate bonds | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | |||
Level 3 | Municipal securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 3 | U.S. government agency securities | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | 0 | 0 | 0 | ||
Level 3 | U.S. treasuries | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | $ 0 | $ 0 | 0 | ||
Level 3 | Variable rate demand notes | |||||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |||||
Assets measured at fair value | $ 0 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Fair value (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Derivatives designated as hedging instruments | Accrued liabilities | Commodity contracts | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Fair value liabilities | $ (1,129) | |
Derivatives designated as hedging instruments | Other Liabilities | Commodity contracts | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Fair value liabilities | (137) | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Foreign currency exchange contracts | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Fair value assets | 270 | $ 965 |
Derivatives not designated as hedging instruments | Accrued liabilities | Foreign currency exchange contracts | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Fair value liabilities | $ (92) | $ (4,698) |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Hedging designation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||
Gain (loss) recognized in AOCI | $ (1,266) | $ 0 | $ (1,266) | $ 0 |
Derivatives designated as hedging instruments | Commodity contracts | Cash Flow Hedging | ||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||||
Notional value | 30,400 | 30,400 | ||
Gain (loss) recognized in AOCI | $ (1,266) | $ (1,266) | ||
Derivative Instrument, Gain (Loss) Reclassified from AOCI into Income, Effective Portion, Statement of Income or Comprehensive Income [Extensible Enumeration] | Cost of Goods and Services Sold | Cost of Goods and Services Sold | ||
Amount to be reclassified | $ (1,000) |
DERIVATIVE INSTRUMENTS AND HE_5
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Non hedging designation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |||||
Collateral amount | $ 1,100 | $ 1,100 | |||
Foreign currency exchange contracts | Maximum | |||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |||||
Term of derivative instrument | 1 month | ||||
Derivatives not designated as hedging instruments | Foreign currency exchange contracts | |||||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |||||
Notional value | $ 176,000 | $ 176,000 | $ 299,800 | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | |
Amount of loss recognized in income on derivatives | $ (1,924) | $ 743 | $ (9,775) | $ (3,275) |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
INVENTORIES | ||
Raw materials | $ 399,564 | $ 467,392 |
Work in process | 1,848 | 1,688 |
Finished goods | 445,400 | 466,551 |
Inventories | $ 846,812 | $ 935,631 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | $ 836,397 | $ 836,397 | $ 750,055 | ||
Less: accumulated depreciation and amortization | (259,752) | (259,752) | (233,158) | ||
Property and equipment, net | 576,645 | 576,645 | 516,897 | ||
Total depreciation and amortization expense | 14,700 | $ 13,800 | 29,500 | $ 26,900 | |
Land | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 139,975 | 139,975 | 139,798 | ||
Leasehold improvements | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 33,245 | 33,245 | 31,327 | ||
Furniture and fixtures | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 9,393 | 9,393 | 9,286 | ||
Office and computer equipment | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 23,326 | 23,326 | 22,386 | ||
Computer software | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 4,941 | 4,941 | 5,906 | ||
Equipment | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 269,671 | 269,671 | 244,739 | ||
Buildings | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 165,598 | 165,598 | 163,885 | ||
Vehicles | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | 57,162 | 57,162 | 49,175 | ||
Assets under construction | |||||
PROPERTY AND EQUIPMENT, NET | |||||
Property and equipment, gross | $ 133,086 | $ 133,086 | $ 83,553 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | ||
Goodwill, beginning balance | $ 1,417,941 | $ 1,331,643 |
Acquisitions | 0 | 81,298 |
Goodwill, ending balance | 1,417,941 | 1,412,941 |
Monster Energy Drinks | ||
GOODWILL AND OTHER INTANGIBLE ASSETS | ||
Goodwill, beginning balance | 693,644 | 693,644 |
Acquisitions | 0 | 0 |
Goodwill, ending balance | 693,644 | 693,644 |
Strategic Brands | ||
GOODWILL AND OTHER INTANGIBLE ASSETS | ||
Goodwill, beginning balance | 637,999 | 637,999 |
Acquisitions | 0 | 0 |
Goodwill, ending balance | 637,999 | 637,999 |
Alcohol Brands | ||
GOODWILL AND OTHER INTANGIBLE ASSETS | ||
Goodwill, beginning balance | 86,298 | 0 |
Acquisitions | 0 | 81,298 |
Goodwill, ending balance | 86,298 | 81,298 |
Other | ||
GOODWILL AND OTHER INTANGIBLE ASSETS | ||
Goodwill, beginning balance | 0 | 0 |
Acquisitions | 0 | 0 |
Goodwill, ending balance | $ 0 | $ 0 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Intangible assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |||||
Amortizing intangibles | $ 121,378 | $ 121,378 | $ 121,378 | ||
Accumulated amortization | (71,712) | (71,712) | (68,790) | ||
Amortizing intangibles, net | 49,666 | 49,666 | 52,588 | ||
Non-amortizing intangibles | 1,174,434 | 1,174,434 | 1,167,822 | ||
Intangibles, net | 1,224,100 | 1,224,100 | $ 1,220,410 | ||
Amortization expense | 900 | $ 2,000 | 2,900 | $ 3,500 | |
Impairment charges | $ 2,800 | $ 0 | $ 2,800 | $ 0 | |
Minimum | |||||
GOODWILL AND OTHER INTANGIBLE ASSETS | |||||
Useful life of intangible assets | 5 years | 5 years | |||
Maximum | |||||
GOODWILL AND OTHER INTANGIBLE ASSETS | |||||
Useful life of intangible assets | 15 years | 15 years |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Amortization expense (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Future estimated amortization expense related to amortizing intangibles | ||
2023 (from April 1, 2023 to December 31, 2023) | $ 1,824 | |
2024 | 3,648 | |
2025 | 3,647 | |
2026 | 3,647 | |
2027 | 3,646 | |
2028 and thereafter | 33,254 | |
Amortizing intangibles, net | $ 49,666 | $ 52,588 |
DISTRIBUTION AGREEMENTS (Detail
DISTRIBUTION AGREEMENTS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
DISTRIBUTION AGREEMENTS | ||||
Distribution agreement (in years) | 20 years | |||
Revenue recognized | $ 10 | $ 10.1 | $ 19.9 | $ 20.1 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Purchase Commitments (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
COMMITMENTS AND CONTINGENCIES | |
Aggregate contractual obligations | $ 380.4 |
Line of credit | |
COMMITMENTS AND CONTINGENCIES | |
Amount outstanding | $ 2.7 |
Interest rate (as a percent) | 5.50% |
Maximum borrowing capacity | $ 15 |
Raw material items | |
COMMITMENTS AND CONTINGENCIES | |
Purchase commitments | $ 309.3 |
Obligation term ( in years) | 1 year |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Litigation (Details) - USD ($) $ in Millions | 1 Months Ended | 6 Months Ended | ||||
May 25, 2023 | Feb. 14, 2023 | Sep. 29, 2022 | Apr. 30, 2022 | Jun. 30, 2023 | Dec. 31, 2022 | |
COMMITMENTS AND CONTINGENCIES | ||||||
Loss contingencies | $ 0.3 | $ 0 | ||||
Amount awarded | $ 293 | |||||
Amount awarded to the company | $ 175 | |||||
Percentage of royalty awarded by the court on sales | 5% | |||||
First royalty payment | $ 3.7 | $ 3.6 | ||||
Amount of one-time payment | $ 12.5 | |||||
Percentage of royalty | 2.50% |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Components of accumulated other comprehensive loss: | ||
Balance at the beginning of the period | $ (159,073) | $ (69,165) |
Other comprehensive income before reclassifications | 3,348 | (83,792) |
Net current-period other comprehensive income | 3,348 | (83,792) |
Balance at the end of the period | (155,725) | (152,957) |
Accumulated Net Losses on Commodity Derivatives | ||
Components of accumulated other comprehensive loss: | ||
Balance at the beginning of the period | 0 | 0 |
Other comprehensive income before reclassifications | (1,266) | 0 |
Net current-period other comprehensive income | (1,266) | 0 |
Balance at the end of the period | (1,266) | 0 |
Currency Translation Gains (Losses) | ||
Components of accumulated other comprehensive loss: | ||
Balance at the beginning of the period | (153,230) | (68,209) |
Other comprehensive income before reclassifications | 2,206 | (78,628) |
Net current-period other comprehensive income | 2,206 | (78,628) |
Balance at the end of the period | (151,024) | (146,837) |
Unrealized Gains (Losses) on Available-for-Sale Securities | ||
Components of accumulated other comprehensive loss: | ||
Balance at the beginning of the period | (5,843) | (956) |
Other comprehensive income before reclassifications | 2,408 | (5,164) |
Net current-period other comprehensive income | 2,408 | (5,164) |
Balance at the end of the period | $ (3,435) | $ (6,120) |
TREASURY STOCK (Details)
TREASURY STOCK (Details) - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Aug. 04, 2023 | Mar. 10, 2023 | Jun. 30, 2023 | Jun. 30, 2023 | Nov. 02, 2022 | Jun. 14, 2022 | |
Treasury Stock Purchase | ||||||
Repurchase price of stock | $ 682.8 | |||||
Number of shares repurchased of common stock from employees in lieu of cash or withholding taxes due | 7,579 | |||||
Common stock | ||||||
Treasury Stock Purchase | ||||||
Cash payment for repurchase of common stock from employees in lieu of cash or withholding taxes due | $ 0.4 | |||||
March 2020 Repurchase Plan | ||||||
Treasury Stock Purchase | ||||||
Repurchase price of stock | $ 4,690 | |||||
March 2020 Repurchase Plan | Maximum | ||||||
Treasury Stock Purchase | ||||||
Common stock repurchased (in shares) | 170,000 | |||||
June 2022 Repurchase Plan | ||||||
Treasury Stock Purchase | ||||||
Repurchase price of stock | 182.8 | |||||
June 2022 Repurchase Plan | Maximum | ||||||
Treasury Stock Purchase | ||||||
Share repurchase program, authorized amount | $ 500 | |||||
November 2022 Repurchase Plan | ||||||
Treasury Stock Purchase | ||||||
Share repurchase program, authorized amount | $ 500 | |||||
Repurchase price of stock | $ 500 | |||||
November 2022 Repurchase Plan | Common stock | ||||||
Treasury Stock Purchase | ||||||
Common stock repurchased (in shares) | 0 |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) plan | Jun. 30, 2022 USD ($) | |
STOCK-BASED COMPENSATION | ||||
Stock-based compensation plans | plan | 2 | |||
Compensation expense on share-based plans | $ 18.6 | $ 16.3 | $ 34.6 | $ 32.6 |
Excess tax benefit realized for tax deductions from non-qualified stock option exercises and disqualifying dispositions of incentive stock options | $ 4.1 | $ 2.2 | $ 30 | $ 2.7 |
STOCK-BASED COMPENSATION - Fair
STOCK-BASED COMPENSATION - Fair Value Assumptions (Details) - Employee Stock Option | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Weighted-average assumptions used to estimate the fair value of options granted | ||||
Dividend yield (as a percent) | 0% | 0% | 0% | 0% |
Expected volatility (as a percent) | 27.40% | 27.80% | 27.60% | 27.70% |
Risk-free interest rate (as a percent) | 3.70% | 3% | 3.70% | 2.10% |
Expected term | 6 years 3 months 18 days | 6 years 2 months 12 days | 6 years 3 months 18 days | 6 years |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | |
Restricted Stock Units, and Performance Share Units | ||||
Stock options, Number of Shares | ||||
Vested and expected to vest in the future at the end of the period (in shares) | 1,900 | 1,900 | ||
Employee Stock Option | ||||
Stock options, Number of Shares | ||||
Balance at the beginning of the period (in shares) | 29,710 | 29,710 | ||
Granted (in shares) | 31 | 3,962 | ||
Exercised (in shares) | (3,990) | |||
Cancelled or forfeited (in shares) | (222) | |||
Balance at the end of the period (in shares) | 29,491 | 29,491 | 29,710 | |
Vested and expected to vest in the future at the end of the period (in shares) | 28,511 | 28,511 | ||
Exercisable at the end of the period (in shares) | 18,659 | 18,659 | ||
Stock options, Weighted-Average Exercise Price Per Share | ||||
Balance at the beginning of the period (in dollars per share) | $ 26.38 | $ 26.38 | ||
Granted (in dollars per share) | $ 59.36 | $ 50.82 | ||
Exercised (in dollars per share) | 14.95 | |||
Cancelled or forfeited (in dollars per share) | 37.82 | |||
Balance at the end of the period (in dollars per share) | 31.15 | 31.15 | $ 26.38 | |
Vested and expected to vest in the future at the end of the period (in dollars per share) | 30.71 | 30.71 | ||
Exercisable at the end of the period (in dollars per share) | $ 24.70 | $ 24.70 | ||
Weighted-Average Remaining Contractual Term (in years) | ||||
Weighted-Average Remaining Contractual Terms (in years) | 5 years 7 months 6 days | 5 years | ||
Vested and expected to vest in the future at the end of the period | 5 years 4 months 24 days | |||
Exercisable at the end of the period | 3 years 9 months 18 days | |||
Aggregate Intrinsic Value | ||||
Balance at the beginning of the period | $ 724,651 | $ 724,651 | ||
Balance at the end of the period | $ 775,296 | 775,296 | $ 724,651 | |
Vested and expected to vest in the future at the end of the period | 762,069 | 762,069 | ||
Exercisable at the end of the period | $ 610,938 | $ 610,938 |
STOCK-BASED COMPENSATION - Equi
STOCK-BASED COMPENSATION - Equity Awards (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Employee Stock Option | |||||
STOCK-BASED COMPENSATION | |||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 21.14 | $ 14.96 | $ 18.25 | $ 11.62 | |
Total intrinsic value of options exercised | $ 26.9 | $ 18 | $ 157.9 | $ 22.9 | |
Cash received from option exercises | 23.3 | $ 18.1 | 59.7 | $ 22.6 | |
Total unrecognized compensation expense related to non-vested shares granted to employees | 115.6 | $ 115.6 | |||
Cost expected to be recognized over a weighted-average period | 3 years 4 months 24 days | ||||
Restricted Stock Units, and Performance Share Units | |||||
STOCK-BASED COMPENSATION | |||||
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 47.1 | $ 47.1 | |||
Cost expected to be recognized over a weighted-average period | 1 year 8 months 12 days | ||||
Number of Shares | |||||
Non-vested at the beginning of the period (in shares) | 2,026 | 2,026 | |||
Granted (in shares) | 22 | 523 | |||
Vested (in shares) | (592) | ||||
Forfeited/cancelled (in shares) | (11) | ||||
Non-vested at the end of the period (in shares) | 1,968 | 1,968 | |||
Weighted Average Grant-Date Fair Value | |||||
Non-vested at the beginning of the period (in dollars per share) | $ 36.27 | $ 36.27 | |||
Granted (in dollars per share) | $ 59.70 | $ 48.49 | |||
Vested (in dollars per share) | 32.80 | ||||
Forfeited/cancelled (in dollars per share) | 32.83 | ||||
Non-vested at the end of the period (in dollars per share) | 40.85 | 40.85 | |||
Restricted Stock Units, and/or Performance Share Units | |||||
STOCK-BASED COMPENSATION | |||||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 59.17 | $ 43.76 | $ 48.93 | $ 36.98 | |
Performance Share Units | |||||
STOCK-BASED COMPENSATION | |||||
Percentage of target performance | 100% | ||||
Performance Share Units | Maximum | |||||
STOCK-BASED COMPENSATION | |||||
Percentage of target performance | 200% | ||||
Performance Share Units | Minimum | |||||
STOCK-BASED COMPENSATION | |||||
Percentage of target performance | 0% | ||||
Other Share-Based Awards | |||||
STOCK-BASED COMPENSATION | |||||
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 1.5 | $ 1.5 | |||
Cost expected to be recognized over a weighted-average period | 1 year 8 months 12 days |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefit Rollforward (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Gross Unrecognized Tax Benefits , roll forward | |
Balance at the beginning of the period | $ 3,020 |
Additions for tax positions related to the current year | 0 |
Additions for tax positions related to the prior years | 738 |
Decreases for tax positions related to the prior years | 0 |
Balance at the end of the period | 3,758 |
Accrued interest and penalties related to unrecognized tax benefits | $ 600 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Weighted-average shares outstanding: | ||||
Basic | 1,047,065 | 1,057,233 | 1,045,993 | 1,058,017 |
Dilutive | 13,028 | 12,389 | 13,674 | 12,401 |
Diluted | 1,060,093 | 1,069,622 | 1,059,667 | 1,070,418 |
Totaling options and awards outstanding (in shares) | 4,100 | 3,500 | 2,600 | 2,500 |
SEGMENT INFORMATION - Net Reven
SEGMENT INFORMATION - Net Revenues (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) segment | Jun. 30, 2022 USD ($) | |
SEGMENT INFORMATION | ||||
Number of reportable segments | segment | 4 | |||
Number of operating segments | segment | 4 | |||
Net sales | $ 1,854,961 | $ 1,655,260 | $ 3,553,891 | $ 3,173,833 |
Operating Income: | 523,805 | 372,951 | 1,008,870 | 772,439 |
Income before tax | 538,964 | 366,170 | 1,036,523 | 758,359 |
Recognition of deferred revenue | 10,000 | 10,100 | 19,900 | 20,100 |
Corporate and Unallocated | ||||
SEGMENT INFORMATION | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating Income: | (124,328) | (106,645) | (244,677) | (215,088) |
Income before tax | (109,914) | (114,881) | (218,658) | (230,610) |
Monster Energy Drinks | ||||
SEGMENT INFORMATION | ||||
Net sales | 1,686,887 | 1,537,690 | 3,248,555 | 2,942,536 |
Monster Energy Drinks | Operating segment | ||||
SEGMENT INFORMATION | ||||
Net sales | 1,686,887 | 1,537,690 | 3,248,555 | 2,942,536 |
Operating Income: | 597,922 | 441,719 | 1,158,740 | 896,282 |
Income before tax | 598,656 | 442,407 | 1,160,330 | 897,540 |
Recognition of deferred revenue | 10,000 | 10,100 | 19,900 | 20,100 |
Strategic Brands | ||||
SEGMENT INFORMATION | ||||
Net sales | 99,690 | 79,142 | 186,048 | 171,735 |
Strategic Brands | Operating segment | ||||
SEGMENT INFORMATION | ||||
Net sales | 99,690 | 79,142 | 186,048 | 171,735 |
Operating Income: | 55,137 | 41,500 | 106,909 | 98,695 |
Income before tax | 55,149 | 41,509 | 106,938 | 98,763 |
Alcohol Brands | ||||
SEGMENT INFORMATION | ||||
Net sales | 61,076 | 32,447 | 107,366 | 47,654 |
Alcohol Brands | Operating segment | ||||
SEGMENT INFORMATION | ||||
Net sales | 61,076 | 32,447 | 107,366 | 47,654 |
Operating Income: | (6,577) | (4,657) | (13,460) | (9,611) |
Income before tax | (6,584) | (3,890) | (13,451) | (9,496) |
Other | ||||
SEGMENT INFORMATION | ||||
Net sales | 7,308 | 5,981 | 11,922 | 11,908 |
Other | Operating segment | ||||
SEGMENT INFORMATION | ||||
Net sales | 7,308 | 5,981 | 11,922 | 11,908 |
Operating Income: | 1,651 | 1,034 | 1,358 | 2,161 |
Income before tax | $ 1,657 | $ 1,025 | $ 1,364 | $ 2,162 |
SEGMENT INFORMATION - Depreciat
SEGMENT INFORMATION - Depreciation and Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
SEGMENT INFORMATION | ||||
Depreciation and amortization | $ 15,576 | $ 15,822 | $ 32,384 | $ 30,432 |
Corporate and Unallocated | ||||
SEGMENT INFORMATION | ||||
Depreciation and amortization | 2,406 | 2,682 | 4,830 | 5,505 |
Monster Energy Drinks | Operating segment | ||||
SEGMENT INFORMATION | ||||
Depreciation and amortization | 8,817 | 8,102 | 17,806 | 16,262 |
Strategic Brands | Operating segment | ||||
SEGMENT INFORMATION | ||||
Depreciation and amortization | 196 | 242 | 417 | 475 |
Alcohol Brands | Operating segment | ||||
SEGMENT INFORMATION | ||||
Depreciation and amortization | 4,106 | 3,683 | 8,157 | 5,966 |
Other | Operating segment | ||||
SEGMENT INFORMATION | ||||
Depreciation and amortization | $ 51 | $ 1,113 | $ 1,174 | $ 2,224 |
SEGMENT INFORMATION - Expenses
SEGMENT INFORMATION - Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
SEGMENT INFORMATION | ||||
Stock-based compensation expense | $ 18.6 | $ 16.3 | $ 34.6 | $ 32.6 |
Corporate and Unallocated | ||||
SEGMENT INFORMATION | ||||
Payroll costs | 82.6 | 70 | 162.9 | 138.1 |
Stock-based compensation expense | 18.1 | 16 | 33.8 | 32.2 |
Professional service expenses | 25.3 | 16.9 | 47.4 | 43.3 |
Other operating expenses | $ 16.4 | $ 19.7 | $ 34.4 | $ 33.7 |
SEGMENT INFORMATION - Concentra
SEGMENT INFORMATION - Concentration Risk (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
SEGMENT INFORMATION | ||||
Net sales | $ 1,854,961,000 | $ 1,655,260,000 | $ 3,553,891,000 | $ 3,173,833,000 |
Sales | Outside United States | ||||
SEGMENT INFORMATION | ||||
Net sales | $ 715,400,000 | $ 649,000,000 | 1,340,000,000 | 1,200,000,000 |
Sales | Customer concentration | Outside United States | ||||
SEGMENT INFORMATION | ||||
Percentage of net sales | 39% | 38% | ||
Net sales | $ 10 | $ 10 | ||
Coca-Cola Europacific Partners | Sales | Customer concentration | ||||
SEGMENT INFORMATION | ||||
Percentage of net sales | 14% | 14% | ||
Coca-Cola Consolidated, Inc | Sales | Customer concentration | ||||
SEGMENT INFORMATION | ||||
Percentage of net sales | 10% | 11% | 13% | 13% |
Reyes Coca-Cola Bottling, LLC | Sales | Customer concentration | ||||
SEGMENT INFORMATION | ||||
Percentage of net sales | 10% | 9% | 10% | 9% |
SEGMENT INFORMATION - Goodwill
SEGMENT INFORMATION - Goodwill and other intangible assets (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | $ 2,642,041 | $ 2,638,351 |
Monster Energy Drinks | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | 1,431,947 | 1,424,212 |
Strategic Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | 981,570 | 979,896 |
Alcohol Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | 228,524 | 233,140 |
Other | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | $ 0 | $ 1,103 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) director | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
RELATED PARTY TRANSACTIONS | |||||
Net sales | $ 1,854,961 | $ 1,655,260 | $ 3,553,891 | $ 3,173,833 | |
Expenses incurred in connection with materials or services provided by a related party | 450,417 | 406,910 | 863,201 | 784,088 | |
Monster Energy Drinks | |||||
RELATED PARTY TRANSACTIONS | |||||
Net sales | 1,686,887 | 1,537,690 | 3,248,555 | 2,942,536 | |
Related Party | Coca Cola Company | |||||
RELATED PARTY TRANSACTIONS | |||||
Net sales | 33,200 | 26,500 | 68,300 | 58,300 | |
Purchases from related party | $ 8,300 | 6,500 | $ 14,800 | 15,000 | |
Related Party | Coca Cola Company | Voting Interests | |||||
RELATED PARTY TRANSACTIONS | |||||
Related Party Ownership Interest (as a percent) | 19.50% | 19.50% | |||
Related Party | TCCC Subsidiaries and TCCC Related parties | |||||
RELATED PARTY TRANSACTIONS | |||||
Commission expenses | $ 18,100 | 10,100 | $ 33,800 | 28,500 | |
Related Party | TCCC Subsidiaries and TCCC Related parties | Monster Energy Drinks | |||||
RELATED PARTY TRANSACTIONS | |||||
Contract manufacturing expenses | 7,500 | 4,800 | 15,000 | 14,000 | |
Related Party | TCCC Related Parties and TCCC Independent Bottlers | Operating expense | |||||
RELATED PARTY TRANSACTIONS | |||||
Commission expenses | 8,100 | 7,800 | 16,900 | 18,800 | |
Related Party | TCCC Subsidiaries | |||||
RELATED PARTY TRANSACTIONS | |||||
Accounts receivable, net | 120,640 | 120,640 | $ 88,169 | ||
Accounts payable | (41,542) | (41,542) | (35,467) | ||
Accrued promotional allowances | (10,807) | (10,807) | (11,222) | ||
Accrued liabilities | (22,651) | (22,651) | $ (14,733) | ||
Director | |||||
RELATED PARTY TRANSACTIONS | |||||
Business Travelling Expenses | 0 | 30 | $ 30 | 80 | |
Principal Owners | |||||
RELATED PARTY TRANSACTIONS | |||||
Number of directors | director | 1 | ||||
Expenses incurred in connection with materials or services provided by a related party | $ 1,000 | $ 2,300 | $ 2,100 | $ 3,400 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ in Millions | Jul. 31, 2023 USD ($) |
Subsequent event | Bang Energy | |
SUBSEQUENT EVENTS | |
Purchase price in cash | $ 362 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 30, 2023 | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | During the three-months ended June 30, 2023, none of the Company’s directors or officers adopted, modified or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (each as defined in Item 408 of Regulation S-K under the Securities Exchange Act of 1934, as amended). |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |