NBEV - Earnings call transcript Q4 2020

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Operator

Greetings. Welcome to the NewAge Inc.'s Fourth Quarter and Full Year 2020 Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded. the to turn host. now will conference your over I begin. Riley may Timmer, you

Riley Timmer

investor Riley and conference Thank Investor be our full you call quarter Willis, of Chief results fourth condition, contain regarding you. everyone Relations Executive Group Wilson, year call President. company. we all call. thank the financial our for I'm Good Mark remind with morning of you NewAge joining pleased Head expectations the I'd Timmer, Global achievements Brent and statements have that operations, NewAge forward-looking and and Inc.'s this may certain XXXX today. current conference financial reflecting to of today's like Officer I'm of economic management's to and performance, results On future

now also the CEO. conference in call, earnings will Investors company's future today's be events. of Brent forward-looking our A performance, may filed included our and Also non-GAAP SEC. those that on obligation differ Form release undertake as at new may results within report transcript call these are information to to Willis, specifically call of on as section result turn measures. on could or GAAP make which Factors are in call of available during certain we to today's to The I'll non-GAAP XX-K uncertainties. with based no to both is a available XX-Q statements, concerning forth risks measures the website. website Any on over annual that we set newage.com. subject these our today and Forward-looking the financial this this is cause and statements assumptions and the present on materially statements are reconciliation future GAAP of update we

Brent Willis

you, and Riley morning good Thank everyone.

in of mid-XXXX come. $X.X initial reach revenue now so from with really now said this time a and to will which in scale that and profitability now relatively profitable million And along of is to a point methodically at as our right ago. we near we half idea Essentially years million forma scale just expect billion pro first and $XXX this that and has base we've that profit an improve zero $X.X a from period EBITDA. NewAge forward. company four now we the short this materialized, systematically commitment on to the We hit intended from all this quarter

bottom improve we more have it's we here? associated the will Financially, resources. the why a multibillion-dollar-sized further now We and have the from don't scale multinational. for right line infrastructure believe Well, Now, the need the we math. just And SG&A.

We whereby and accrue amount everything access; will performance. have systems, disproportionate benefit the EBITDA need to of breadth the a the got capture growth the to more you we've scale and that of margin market people, line bottom

them regions call perseverance Selling Social that our long-term who To on me unwavering veteran all their division though of with quality like on even and have result, always the profitability our still scale of industry I for leads Wilson, of Direct and we Group historically the this success. team of people. a does. with Now ours, it the on our President It and have But commercial companies success our end, smaller Mark depends our operations. morning as depends much in

more and best the industry, progress our not operating and is one of the if best, Mark discuss the our the performance and on far provide in and operational results details geographies. the he will think in color I of by away key

$XXX face have you expectations us, have years said a we revenue inherited, four positive let's we are add you do. ago and start-ups and generating, flow one million articulate you half begrudgingly you no what of believed when to public if start would and it. become of out will these would Now, your and And we're EBITDA cash like going if

methodically just for is and topline it. EBITDA, our build not are however financial we're our that structure margin to going EBITDA are So, to business both and communicate bottom-line going consistent And we the will and structure next consistent What business we to confident free we we that have the milestones. cash, do improvement. say

our BWR as Now just the mentors changed leading a loved the my say, retail matters. level the to end that We on brands, did EBITDA and divestiture of of cost one this the it. more about focus at what the retail QX. economics than us at a is brand leverage was $X to of methodical right used that to end, frankly To scale the the million performance, the not do we or That but really in anything move. happened sector beverage have year

move out building end thrive. enables and focus them. a So selling greater year. CPG an a the even must-have survive in competitively for the as $X And we more on made to is which route-to-market our with to advantaged result social trend EBITDA per major decision divest frankly tools, at this see million and And direct we least companies

focusing of a human industry resources. in and external in those resources We the opportunities and front critical -- to have gross business XX% opportunity this against us margin sector is tremendous tailwinds success financial behind over and And both with growth the both our us. the of of all organic our

big a than additional It something to as front of just changes So to the this that as Look for People a the continuing next foundation. to the in success Chief have We company in high-performance leaders is we opportunities set when Officer and continue we team culture the It's expect bringing skill promised. team why is a look critical where we to multinational. few springboard. both with to we our a we saw us. are building lead and the building more the in the right we'll our make hired years, those we're culture and on management is is of embody what will QX beginning management bandwidth strengthen a recently to be at to multibillion-dollar to

have the scale. We

profitability. We have the

the market have across more customers aligned committed team than than have and we an XXX,XXX and of XX We and more brand countries. impassion partners reach

have We financial and has organic we capabilities have team and whole an management there stronger accelerated it and the the front from combination. of ARIIX us. the increasingly and in of a resources and only organizational opportunities is host growth since business growth was

coupled all continuing I external Given just said getting this growth like opportunities things together well is the all frankly so us of something that foundation. present much come are themselves than for big. is springboard a have earliest glimpse far that the with transformative now, are to more the that This investors the of

Mark you some to us happening what to operationally. So let pass me for insight Mark? is it give on over

Mark Wilson

Hey. Thanks, Brent.

world of and As the the of directing the the Group President markets, people to is NewAge, sales around leadership our strategy. our our at all and thousands hundreds -- my our of regions, global in focus customers partners brand

am or And results we synergy addition, the in of with convergence I our XXX leading companies. days capture so. and to are integration responsible happy now that the is combined report, seeing and the team I'm better-than-expected In execution with first successful our

Now three pleased report. to things we are that are happening

months $XX would synergies around first coming from the million combination identified the to that together. accrue XX of in we XX First, months

savings are days we million have $XX captured $XX deeper. alone in there annualized the know already beyond potentially as benefits our first XXX and million we in We additional commitment dig over even

$XXX or low meet as with sales. we year single-digit Second, are Oftentimes slight number revenue and in exceed million we to we confident of right double-digit has did organic softening growth Pro high mergers we which this Brent us forma a continue at a net growth, see to Brent even in last experience guidance. a revenue. in our guided regions. previously you mentioned can

bigger However, companies opposite us accelerating as sales it's join for been and from just the us even we see actually for opportunities. leaders

going that pleased are same thing aligned as report facilitate collaboration. now with know to are the of is business we according performance the international a and making team I'm that we're This coming one third everyone management and to And creating takes direction. new scaled levels. We approach. changes together and is and spend run our operating the we to only and that pulling discipline new goal sales in manage are with culture creating successful ARIIX, with profitably. a company from culture one that it requires Coming serve this what a to and We forward. profit pay, will that that we hire, The

segments. part, all most the as profit-generating for function regions geographic different our So

complement that in leveraging have our opportunities, growth or markets competitive and the can opportunities represent As Brent in following: the invest time market in our organic represent the that Europe, the first, and focus potential the Japan, our will those most comments, core sustainable we and growth. and and markets where fit our to a into our high-potential markets markets overall the We a profitability, third, and strategy superior alluded is and or only and greatest greatest we for efforts more focus represent potential our to presence objectives share Western focus us on operationally markets China goals; will increase develop emerging eliminate performance that on resources advantage. Americas; best the we strategy. fit provide leading high to of achieve help current believe scalable in markets and sales to discipline second, core believe either and downsize don't on This we profitability where have selectively his opportunity

top dive is That record into continue some Europe insight continued On post-merge performance. we achieve business the and has quickly to of me and our to fastest provide and their growth. sales now being growing our Let region. largest, segments trend also some of

number Spain. leadership markets brand Our Italy of and in France in and the by of growth driven is being and the success customers partners, primarily strong

is strategy similar in now utilizing Europe technology where to become Greater one in place and Switching working to easily brand Our systematize around translate. This we to world. the what help how technology is the And they our Europe that regions are to China. do the and selling social resonating we to and partners selling other will social influencers, our region. approach

Combined Greater years. are in very combined Reversing encouraging be the during we the this saw sign time a first introductions, growth the Morinda growth in fact, to our QX on XXXX. Noni In already China for major the to revenue platforms a in is year. are $XXX the responsiveness for in and and growth than live several We other of Tahitian million growth us seeing social market. we encouraging media sales WeChat seeing to attracting more good with Noni are that product and and very, region business. several business strength Greater our is Japan, this experiencing as leaders And new growth we see trend Combined, streaming, side brand new China of in company. Japan

They business have excellent efforts On the the the of focusing and the and announcement profitability. add to are products of leadership of the to continued revenue building bring And healthy government relations recent planned portfolio we a an add $XX at and should nicely They the ARIIX side in unique with corporate current believe on of our of level in side the field. Japan, that in have will offering. merger the both the strong Elivant add the [ph] and business. subscriber we NewAge additional million E-Commerce

in seeing solid engagement at is of Mexico, our Canada level are motivation US, and Finally, high. specifically The among the we all-time Americas, an leaders and growth.

Mexico growth has accelerating the our their for groups also growth. The prior Division leadership. the our XX% US had brand had to double-digit our triple-digit to partners selling amazing that go our and that including of success growth group – our social here QX, in All Direct are to and experienced really to the Store direct credit that

and way care example, looking partners is easy-to-duplicate lifestyles Mexico. the professionals Alberto this partners for and attracted way healthier plicate millennials system financial has his new Muchi an Paulo into model team they is Other for which social a Peña health new second young to attracting particularly personal from and his do. who Dr. model a And to for system professionals everything unique like like by none. to built and For is Gen-Zs. selling create incorporate Italy, business Peña Dr. from

just and have the leads quarter-by-quarter of are credit. lifestyle thousands deserve like It's partners experience the that are to the Winnie performance. leading ARIIX and globally. These confidence to we product selling of are activity [ph] hundreds Brent. that measured represents. I'm of and Belgium a springboard success going to of they impassion turn Our now of what and are few conversion media for leaders ones and that our the of that to and whose us the and activities back from drive over France, the our these talented partners contributing brand that social all it way leading social folks is our the our This selling efforts build global are on NewAge combination really

Brent Willis

and Thank going you, man. it Mark. Great keep job

the improvement adjusted capture guidance most exceed $XX.X less improvement a fourth $XX.X our metric only the month of month's this EBITDA, Net throughout division increase the a adjusted which of other ARIIX accretive. Let driven of financials to fourth versus result last by up to of $XX.X as XX.X% reached believe me -- the the close in XX.X% Mark it and revenue million higher quarter synergy the more we we terms directly negative million prior loss before to we of compared $XX.X reached step in important conservative will million was review plus in income a time. performance the a year an the the In the quarter the to and of divisions businesses, versus new QX, million we the believe same And selling also a we we in was This XXXX, an questions. we some our XXXX percentage and a consolidated relevant increase the year. We was the translating quarter. of cash all period And up have Driving in had fourth the XX.X was around the be open little point of the month right would companies point communicated the margin for of detailed reduction $X.X net EBITDA compared that XXXX, ARIIX were going is reached starting in margin million an XXXX, from with of quarter a forward direction. year. the social it Gross addition is direct and for of that just and over quarter so reviewed, know we line I million, of and prior revenue, regions million, and for year. last And for free in all and respective ago in bottom profitability. of consolidation net in $X.X benefit cost of breakeven $XX.X than private loss flow. where XX% year.

in ending For forma was XX, size and Pro near XX at doubling the XXXX. December scale million net million XX.X%. year an XXXX, the year reached increase ended full for the $XXX.X period a $XXX we our times combined the almost revenue for of year the for XXXX, the versus scale, $XXX.X revenues full were of of million in right

million improved with sheet significant X.X another million over well as flow XX.X% short-term, of points. increase retail the percentage was very compared net of financially in performance unrestricted. step We businesses, margin in reached which to of direction. the February cash cash Switching Gross impairment with low year So million the operating divestment was in restricted, driven was the in or million non-recurring relative brands. to event, compared we of was would And another was ended revenue, higher million year the the cash December XXXX XXXX. $XX.X brands. subsequent margin loss million balance added expense related say result an new $XXX.X million long-term at million $XX.X position. a as improvement $XX.X just statements. finished we $XX.X year of for sales, for $XXX.X or loss the divested million right the increase strong as retail revenue, to $XX.X or margin and XX, investors the as net The and a of know and net in $XX additions the to a a XX.X% us of negative million Gross of put a in was $XX.X the for million Net and and flexible now year, $XX.X by $XX

were XXXX, million, an assets XX, million prior period of increase around $XXX.X total $XXX year. the ending versus For December

still closed the our and And the given the combination and not X-KA completed to we working all the finish our November audit Deloitte. time all complete with beginning are in of on and testing Now in our XX-K procedures. we end the to filed the financials of February, just it's auditors enough and required

complete XXb-X a time and final So that additional likely provide the needed we to work be testing procedures. to will and filing the us

and incredibly the over have the today's are target-rich industry-leading any as of to sector QX of industry-leading machine. Number and players shaping an with know carrying a differentiated over plethora is would see no front consolidate these We're in business. very four, to and said, to So, growth growth were I'd us believe Number have we and of excellent we in up an both one despite our EBITDA to tailwinds home the from are there build and we integrate to I four have types portfolio external of company grow are both free shareholders, and InBev. to right billion environment with used accruing versus in or of that questions are the consistent was direct-to-consumer address like advantage that just to have stage flexibility you organic either of to Number in up what Number the and XX% one become that continue for as unconsolidated what growth. add brand be margin we social a more. gross finally and execution additions And in becoming see earning the have in $X.X existing And direct-to-consumer in just quarter believe I now them capture and with of from showing are support and the opportunity five, than the we advantage see we to and to of investment journey. open previous takeaways financial said company no, that if tools. segments value-added a superior effectively exposure do to what There underlying going a from years of as top very subtractions opportunities those XXX,XXX revenue revenue margin in We capabilities get them. markets a growth can trends the in important to position deliver to and that are no continue is and is same our Number vision where are to a EBITDA. clear going this front decisions category at fair strong improvement work summarize, to flow two, these opportunities profitable partner And team, the the We're looks wherewithal core more positive we'd financial call. EBITDA. organic to we and we and selling associates. products normal have we an track our will route-to-market course trends. we of advantaged of real cash growth. of we companies quarter share us. terms business year-over-year methodically in exactly beyond is in generating do we It to and six, and are to record truly bottom with that to for next our ago, if we what healthy three, that No our we model set how are And business management number the here The competitively in Like so. a attractive in believe distributors problem. we do six put operator. with the threshold. And brand to like one, return have to NewAge the drivers their will confident QX XXXX made here competitive partners us to AB be going we capital us. sales believed a see an most take the few increasingly and know We the and what happening net have going facts revenue core of organic give we performance, line

Operator

[Operator B. proceed is first Bain Our Please question your Riley. with from Instructions] question. with David

David Bain

the and XQ execution. on congratulations strong and Fantastic

the did you. The selling first become just you had, to speak question I you have distribution which the you Brent opportunities And in laid pointed social out intent obviously guess front I some obviously, and largest your of company. growth, to to you organic

you they're Assuming understand can it that? not traditional how multiples? I'm additional there you can acquisition? last but growth, I you help I look it do some I of not at we potential terms sure, close an mean The was comps one targets of that outside guess times XX was of diversity, or trading trying looked can number an in are mean, to price, done the Is over selling and us at dynamics what announced acquisitions, for reps, look And calculate outlier, in acquisition geographic maybe below consistently social on like XXXX. you time.

Brent Willis

criterion multi-faceted each for And Board those. our both is about of seven in financial eight question, But And the that one that set really there's been multi-part we strategic -- Yes, stringent and pre-synergies incremental components a Dave. that frankly of we a got on upon have set of criterion. mean, a synergy has top the and or look, is I on financial be for and is advantage from That how think we the develop side learned group. capture frankly competitive the to has we've answer it that one, XG accretive to the benefit shareholders fundamental shareholders. number

and the Potentially NewAge going shareholders. XXXX, at stock, balance upon accretion outlier we a did potential a done opportunities for financial And an range those enable Morinda that come from And times have and essentially, So, we on be where these more right? outliers. COVID and standpoint, need and alive them to all Waters EBITDA So, fold. the forward criterion in China down we EBITDA. vehicles And we one Americas. we bring and Japan, bigger we're we've bottom represent is Europe, a right? from these metrics we're the our from companies in potentially of strategic want they And harbor that earn-out that than growth the Western access those very to to and terms cash it of are in companies can But, one in and our and we all those we potentially of need to careful equity times to bit sea and got of standpoint, really dilution. and stock markets a the increasingly was on a really the a also that, is at when is selectively think choppy ensure are But, I going they boat said line stringent core opportunities, a the them. attractively lot integrate the of think, little have disposal safer that into debt word processes focused

Africa, investing, includes cone which Mexico the from first tip look southern kind America we where markets of further the Africa to we probably are are and of or the we Latin those potentially emerging the standpoint. parts And market penetration potentially those of Korea. also at and of look where a potentially countries, CIS southern few So,

develop would accretive on brand we'll we brand terms where emerging look at in just then, competitive in and product compromise three we side, platforms. never scale we competitive product differentiation too us. where advantage So, products. stand that for And of believe our position opportunities of we've healthy the market some terms functional be And a side got the on across our we what it's or the can advantage we It's believe for.

their we that really of look opportunities. some wealth criterions they're we team organic the Mark there those And of see see job just So, you growth realizing for. on companies capturing bring these doesn't and just invest think partners expect will all those. we're But and external when are doing boy, continue have and to a But, it. opportunities, to and happen organic the as brand going superb investors in and of organic that But, a That growth are, opportunities, growth always you superb together. I are growth all a the opportunity the regions done coming. job

David Bain

the that world. different XXX,XXX going the We direct more training That hoping the the -- younger, transformation you work that that and opportunities that acclimated on. attacking all to IPC geographies But, as technology. I I'm at you're the look Yes. Mark to as see have is That's do that social that get focus to have to you demographic And something was you're but about spoke how willing innings. technology hopefully than What reveal other excited we a from this, there a more can thing early my it different one and and that little is we're organization? specific of one bit is And know force, How to sort they're specific. When shift you be follow-up. over the some doing acute you're having platform the selling face-to-face is and discussed to reported? you've an geographies? platforms an the and of selling that

Brent Willis

you try to to it first. Mark, hit want

Mark Wilson

to. love would I

many are social platforms, many selling options social different so out With so question. commerce, great there So, there. and

You more versus are different, popular because Instagram, the of Facebook TikTok, really the that need and example, demographics specialize kind markets of approaching are there of an WeChat to in China and little bit to of the more slightly other using region we're a still. where, for platforms some

sure we're The few new making coming predispositions of and making we're diversified the sure be tools will we're would have. that attracted so, months. that out we're and those And will on to our leaders kind in announcing, some the that areas next working that we in – be

weeks, have we'll to goals social but several be the if – attract launching selling one So now whole individuals and make to them is look customers. tens make sure is you of for not to make the to platforms customers easier attract and game hundreds influencers that leaders, here millions at inviting be the in thousands it products the person to our next certainly, be we have we of those because to And take for of to it through consumers, want a the great of selling. their social of easy millions, average some

working will We a will make rolling and it of come late selling. a quarter, program social and easier that out. new approach new we'll out, it in even on Probably are kind also that be second

in think we'll end So social going be months. individuals, talk XX% in I close to of who just the an attract through about to are of drive selling. And the more growth model. that it's our that to – that's in budgeting way easier to And interested we're the new this coming year

Brent Willis

more in to versus social lifestyle used platforms more in know Dave, it different And China. Thanks And selling direct would I is the you going and say, I as tech in Mark. Europe North add much America. and then to and was is Western that it's

also companies more driving marketplace e-commerce social side a the much is of more And tech much leading some the the of the them we XXX,XXX And selling to Mark company company same tens more and of side. is that distribution influencers selling rinse have just talked time of consumer our be about of them brand So is only social that not when lot it we selling accelerate social that the plus all we is some differences, our this is the leading will the and route-to-market e-commerce going intend we to But becoming of repeat. very side selling Mark and selling hundreds of and new converting partners about the addition thousands we of really different, we as believe talked overtness direct right? that advantage level world's millions kind we there Etsy selling and the things as technology to those company, tools of of and but the we in brand different. not And they entire is say, are can forward. what social marketplace competitive about, much So new of of recognizing which worldwide, are social technology company, route-to-market. database be all expect giving It at think on the of have. partners to is that that converting selling these the

foundation, So off got the we've top time, but a the to now transform we the same that's expected. as at is this. going and of organic It forward springboard it's potential company throwing huge the the really that on growth profitability

David Bain

Appreciate right. to so Thank really Yeah. We you transformational. find All guys. much that be it.

Brent Willis

Thanks, Dave.

Operator

with Our Partners. with Global question Alliance Please Aaron next is proceed your Grey question. from

Andrew Bond

previously the mentioned Bond provide Good Aaron ARIIX acquisition? morning. the on This product inventory is on on around You as system top you Could levels update line for Andrew Grey. you for questions. the integration. registration, timing from taking and an Thank synergies line dependent our potential timing

wanted those were you be see, to there expectations Just Thank might able realize benefits? on updates to any to you. when your if

Brent Willis

that Yeah. of for It's initiatives really entire Mark it we leading all call the that company those both sides. from convergence team and included that's representatives the

the Andrew's revenue from give synergy question, So in synergies? on happening the on side cross too an we where what's update Mark, pollination? can And are you both cost to

Mark Wilson

a we've Sure. opportunities, you. taking at think that. first realized already I we're Yeah. mentioned second Thank of million all, in as $XX seen And I swipe earlier, but

so department see, coming we're by looking one as fail you'll region, swoop, it we're big a and together. more And rather at by than

offices, we're convergence which are have that of coming Other will markets the markets very, some through up, coming your opportunities the together converged will you convergence. will already already a see markets June converged rest the majority timing around at together We've have -- and together. trail well. in going the probably process, out you of We're year. our as started as during in is leases very looking So some be

through. So see working shipping come we identified Including realize process, to will efficiencies, the benefits will other team as everything drop of opportunities contribute those through we've that which already many where we'll to our this to so opportunities that purchasing, manufacturing, operations, together, operations with additional continue this. convergence from and

would because a future we'll confident we don't just hit more that model if little opportunities we as all as even that be converge and the I will that go allow us like we've getting And we're is these, example, with Aliven that company I even surprised, afford that we're substantially moving efficient more the greater even said and million forward, announced for the we very previously, those not to. in merger So the And in the us $XX beyond coming opportunities time. together committed the seeing. with --

is of to used fact, right run to something have seen We I've in been currently that industry, those the technology and in time the a of lot in time a lot never to plans other We're blend allow through. now. time some done unique the our issues, time for industry never we us family where multiple some at forcing effort this. investing programming the the us, literally right going profits in allow rather that's people to putting in get a IT before which can compensation than drop to to and afford opportunities And

But you're encouraged stay we're and very the see coming tuned year, to throughout convergence. where revenues with going we're profits at. So additional from the

Brent Willis

I would thanks, Mark. to just add --

further upside synergies. On the those some of quotient synergies is revenue of

enable And independent whether is broader first-mover just right? sell this Japan showed -- that with one level components our first-mover success. to of the translating for that capture to of different + that's example just were given advantage. of portfolio that cross-pollination one And ARIIX different that CBD our to in the other example, all but it's in those Noni third-party units our -- early Zennoa that So doing the and we still one or our shots too there. different We so of number all advantage some -- to where just to surprised we're And of Japan, synergies. research businesses, those of sell that brands we benefit of sell Japan, them revenue in its enable products the in CBD have of selling we now those had were to supplement one we're

Andrew Bond

but Great. you Thanks how know process you. Could you for little follow-up, structure Great. touched integration color. umbrella talk the you're the uniform a commission that create just structure with and looking eventually to as about the I within organization? commission it, deeper. on to ARIIX, dig And Thank a just specifically around

Mark Wilson

that Do take Brent? want me Sure. you to

Brent Willis

sure. Yeah

Mark Wilson

process, a all imagine all that I taken as this -- can some already smaller complex as and So the different you markets we've we of it's with in And very together. bringing mentioned, markets. our

some of phases. used that the that several around July of markets conversions will we working world starting have during and planning we've that these the Colombia, Brazil, are And mean those compensation the be integration the of and kind with is on. slating first together. our of IT bringing some that we're markets as June June, many plan test timing around one example, would into together we're in For would Mexico, that process as already that The see a markets majority for we these converged

to open had than of together. teams to convergence seeing We've about and take kind and compensation us make see of kind plan live COVID up the and facility I this as run and team events little is we're as in-person sales It So together moving coming and you're those listen make them. We're growth with events, staple virtual our of to the to the leadership. push to ARIIX blending keep move few is blending keep And one. have time. mentioned, some to But starting too that as of just into meetings, one very, becoming simpler these leaders opportunities number our And for a we already things us to meetings our work leaders and excited very both to rather of brings the they're a the the run and going we even forward. and sure again. going separate some would not a going We're a this. forward give key to

kind run it uniqueness something of So our whatever to developed able convergence that make those for with together. to sure takes in the that IT, we've we're comes

of and towards later markets as probably baby year. some I And take the that going end be to So the year, other again the think we move the we're steps of in if Japan not will in forward.

Mark Wilson

that's compensation It's say, it because they question is because consolidate. companies in Andrew -- of that insightful selling the our able run a us this. and of merge push drive system. flexibility why been why outstanding real move at going pace going it's it do with can't right? Mark to challenge having when that's do out and right? right to to think as We're IT Mark team to too just said they to going concurrently their success it's a one people depends and to the to let's that's what income done. leadership the lot they want committed to leaders anything direct multiple pointed that so of going outstanding to our on get how is we're and So SOX their just really hurdles what's of But absolutely figure a But motivation we our livelihood -- able do the can't So to our which want that differences and why trick not systems group to not compliant leaders be for we've some and we're still allows we're out right that. compensation their and be to

Andrew Bond

quarter. the Great. you and on a detail profitable Thank for congrats

Operator

Mike Northland question. your proceed And our from with Please Securities. is question with Grondahl next

Mike Grondahl

combined partners how over next companies to Yes, thanks guys. break of it brand each the to going Is you and year or they're think of for the grow out kind possible two?

Brent Willis

R-square matter don't a what is between net does those there correlation There's a We brand engagement to revenue. things Mike, good sort XX% partners partners of of down numbers. of know and numbers because people your and lot come that really other really brand -- correlated but of question lots and but and about a today is the it's your there's factors, the motivation

communicate go we XXX,XXX. we as forward, so And

of partners and customers larger expect because partners the And in that. let's of brand is of affiliates important to actually But time, build and of and are there. actually millions at tens we millions thousands Mark of like years for and just brand same say terms of how we building hundreds want revenue. subscribers and know we number than get consumers in that few But substantially database is next Our a brand partners. to said, the we

leadership brand versus how many and versus manage business one side on really -- in them. little So markets all Zennoa into side one side, most that we're into we management on merger six a months out LIMU days couple side, one don't of partners, way. the the break team, hard versus than a the And communicating we less it's the the really what It's more months and driving merger. to and Morinda with bit than ARIIX XXX really have the because of

So going forward, to one team. it's just going be

Mike's to know don't Mark at what And look separate. question. would But really else don't good we I you as so it add very

Mark Wilson

Yes.

and know, create is, point to we them blend one tried I'd Brent's thing you we But we've were to through other The team. certainly going as add merger, the this. watching were together

or though North leader heritage you, done tribal Rick one together from or ARIIX I coming area job two amazing here at even came cultures the I working level, they're from And kind of example, America an came together or came together from and the of so had blending Morinda our leadership about under especially Zennoa one for of, are to group I operating the as LIMU, which really -- and your force. Redford So, has speak now NewAge. excited

the They around were that the an They presenting with showed And that in broadcasted kind together. working demonstrated so and had together. together. on of, teams their we were Florida stage together. nation just They the, event

from basis, sorts done blend we of, together rather weekly and the in fast Morinda to we're new histories, or that's I what is this -- we've one into an we've come a culture culture. together. that try and think bring So ARIIX together backgrounds And of trying really all, than so job that bringing culture. good a a to you as as into created It's possible past leadership blending on them and attract this NewAge they And this companies as groups is group. really

to I one and together them all that bring like group keep them way. into So

So separately. identify really them we don't

Mike Grondahl

because would there's question Mike's seen what it? ARIIX follow-up with us, can say driving know driving what's on is we've you a growth because but in is happen organic other really Is right? that for it because Typically actually it Mark, pullback, as really you typically terms that you I doesn't in of… companies

Mark Wilson

It's a great question. things. is excitement The here real several

new this along our all, and sidelines people new markets. part convergence growing of individual merger see partners the you commissions with exciting me that as of part opportunity you have not seeing their may that so a of offering let growing brand participate with example. well in take is group, have look but for and then watching. and growth businesses take really people and on of together this And at and offering it coming been an coming new it element public when be who their -- It's exciting growth brands. your to First potential together only they're Europe the have that an is to is our Europe field growth encouraging products the the company just

they and or success. people growth, see to out so brand And successful people they in successful to organization in have the of out let's becomes is And other to the that. love be France a Europe, are joining markets us with that and momentum you partners because experiencing it want it excitement face hang we're now that and Italy see talk the And so contagious speak. you there. get like And you part the when

concerned as things with is all think are America combining you leaders than this the are that ever coming that's spurring a And current looking the preventative are things think the into. So known us with more the addition been we're in they actions become to People side seen home-based with have been. as taking right And new I now that situation in as COVID excitement. potential. our We've probably there. as excited opportunity I these together threw they've some the growth and that with business of current economy, hustle for health this a North

at excited So time, I the versus that a can it. coming declining. combining the it and together are so and same of the growth that's they of easier company potential it be this But think about a made they everything for company part the

of Morinda new NewAge that new I companies a the of we've to we're to now group Aliven of time. attitude. have concern are in want and attracting opportunity living where part that why kind they're And and of and more over we're fact win, like of they're seeing In think whole this whole a others igniting they this. in reengaging that's probably, And seen part that decline that a be we're

So, I iceberg tip on of that. think you've only the the seen

Mike Grondahl

Got thought it. LOI And Is to might go with there it that's could under close? an right that then, Aliven, I or think now. there definitive and when any update any when

Brent Willis

definitive terms The and in the really LOI Council with it Yes. mirrors SEC of agreement no surprises. is consideration

in going and to and million just Mike tremendous leader would $XX-plus their we'd to tremendous in consolidate be that such imminent in and EBITDA. who to the ambassador got for revenue leader and it we And is founder it's tremendous I in Osan, So, love say incorporate combined has $X-plus bring a and government million because relationships, want group.

soon So the a love merger really integration busy seamless on ARIIX and was because, to stuff our we've X-KA But Aliven first. lot our SOX purely operations. that from to our about the our it's We've and and what's do compliance done NewAge But Japan we'd as are Xst just as got standpoint. of and XX-K the that in possible. So get audit is, to February, got nice on of hands -- to in right? we integrate consolidate through got and

is it So would council that it definitive and say mirrors is I the imminent. the LOI. with would I say agreement And

So March shareholders thereafter. would should expect I in today shortly that coming or

Mike Grondahl

Got it.

you. Thank Okay.

Brent Willis

Great question.

Operator

remarks. turn end Willis, closing session Brent over to we call question-and-answer now of the for and And have I reached our the will

Brent Willis

common to the that can you when everybody really flexibility. growth. which when that that's superior this and delivering one you definitely when gives focused these of we that, a organizational opportunities, is these for of the a growth you've team return shareholders. and the boat stock capabilities kinds XX% perform infrastructure the against underpinning It have business. all performance, ARIIX health excitement Hopefully on of the same lot can financial have XX% stock hear financial as you everybody. got goal. it's people for all of see Thanks, we're given kind start price And confidence shareholders, now have based and all of that and on And of you in combination financial consideration and

we equity committed price are XXX% all So, appreciation to for shareholders.

the we've term. very those So taken decisions for significant in that to and achieve long a way --

So, we're QX, the with thought our the -- profitable XXXX quarter. first we be very pleased quarter. Frankly, would our

we're EBITDA QX. in profitability So, gain happy to

we're and to -- going So just back. not look

support continued tuned. stay the and much very So, for thank you

Mark Wilson

everybody. Thanks

Operator

you And at time. conference. your today's concludes this may you lines disconnect for your And this participation. Thank

NewAge (NBEV) 16 Mar 212020 Q4 Earnings call transcript