Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 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 | 1,046,711,932 | |
Entity Central Index Key | 0000865752 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | |
CURRENT ASSETS: | |||
Cash and cash equivalents | $ 1,672,660 | $ 1,307,141 | |
Short-term investments | 1,383,028 | 1,362,314 | |
Accounts receivable, net | 1,190,351 | 1,016,203 | |
Inventories | 906,723 | 935,631 | |
Prepaid expenses and other current assets | 110,958 | 109,823 | |
Prepaid income taxes | 30,889 | 33,785 | |
Total current assets | 5,294,609 | 4,764,897 | |
INVESTMENTS | 41,152 | 61,443 | |
PROPERTY AND EQUIPMENT, net | 545,922 | 516,897 | |
DEFERRED INCOME TAXES, net | 177,039 | 177,039 | |
GOODWILL | 1,417,941 | 1,417,941 | |
OTHER INTANGIBLE ASSETS, net | 1,222,598 | 1,220,410 | |
OTHER ASSETS | 145,101 | 134,478 | |
Total Assets | 8,844,362 | 8,293,105 | |
CURRENT LIABILITIES: | |||
Accounts payable | 491,249 | 444,265 | |
Accrued liabilities | 245,932 | 172,991 | |
Accrued promotional allowances | 308,094 | 255,631 | |
Deferred revenue | 44,440 | 43,311 | |
Accrued compensation | 42,673 | 72,463 | |
Income taxes payable | 55,123 | 13,317 | |
Total current liabilities | 1,187,511 | 1,001,978 | |
DEFERRED REVENUE | 219,764 | 223,800 | |
OTHER LIABILITIES | 41,727 | 42,286 | |
COMMITMENTS AND CONTINGENCIES | |||
STOCKHOLDERS' EQUITY: | |||
Common stock - $0.005 par value; 1,250,000 shares authorized; 1,117,392 shares issued and 1,046,616 shares outstanding as of March 31, 2023; 1,283,688 shares issued and 1,044,600 shares outstanding as of December 31, 2022 | [1] | 5,587 | 6,418 |
Additional paid-in capital | [1] | 4,829,301 | 4,776,804 |
Retained earnings | [1] | 4,706,192 | 9,001,173 |
Accumulated other comprehensive loss | [1] | (147,911) | (159,073) |
Common stock in treasury, at cost; 70,776 shares and 239,088 shares as of March 31, 2023 and December 31, 2022, respectively | [1] | (1,997,809) | (6,600,281) |
Total stockholders' equity | [1] | 7,395,360 | 7,025,041 |
Total Liabilities and Stockholders' Equity | [1] | $ 8,844,362 | $ 8,293,105 |
[1] 1 Stock Split - On February 28, 2023, the Company announced a two-for-one stock split of its common stock to be effected in the form of a 100% stock dividend. The stock dividend was issued on March 27, 2023 (the “Stock Split”). The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information. |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Common stock, shares authorized | 1,250,000 | 1,250,000 |
Common stock, shares issued | 1,117,392 | 1,283,688 |
Common stock, shares outstanding | 1,046,616 | 1,044,600 |
Common stock in treasury, shares | 70,776 | 239,088 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | |||
NET SALES | $ 1,698,930 | $ 1,518,574 | |
COST OF SALES | 801,081 | 741,907 | |
GROSS PROFIT | 897,849 | 776,667 | |
OPERATING EXPENSES | 412,785 | 377,178 | |
OPERATING INCOME | 485,064 | 399,489 | |
INTEREST and OTHER INCOME (EXPENSE), net | 12,496 | (7,300) | |
INCOME BEFORE PROVISION FOR INCOME TAXES | 497,560 | 392,189 | |
PROVISION FOR INCOME TAXES | 100,116 | 97,986 | |
NET INCOME | $ 397,444 | $ 294,203 | |
NET INCOME PER COMMON SHARE1: | |||
Basic | [1] | $ 0.38 | $ 0.28 |
Diluted | [1] | $ 0.38 | $ 0.27 |
WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK AND COMMON STOCK EQUIVALENTS1: | |||
Basic | [1] | 1,044,909 | 1,058,810 |
Diluted | [1] | 1,059,069 | 1,071,108 |
[1] Stock Split - The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income, as reported | $ 397,444 | $ 294,203 |
Other comprehensive income (loss): | ||
Change in foreign currency translation adjustment | 7,981 | 1,079 |
Available-for-sale investments: | ||
Change in net unrealized gains (losses) | 3,181 | (4,059) |
Other comprehensive income (loss) | 11,162 | (2,980) |
Comprehensive income | $ 408,606 | $ 291,223 |
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, 2022 | $ 6,418 | 4,776,804 | 9,001,173 | (159,073) | $ (6,600,281) | 7,025,041 | [1] |
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 | 3,129 | |||||
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 | [1] |
Balance (in shares) at Mar. 31, 2023 | 1,117,392 | (70,776) | |||||
[1] 1 Stock Split - On February 28, 2023, the Company announced a two-for-one stock split of its common stock to be effected in the form of a 100% stock dividend. The stock dividend was issued on March 27, 2023 (the “Stock Split”). The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 397,444 | $ 294,203 |
Adjustments to reconcile net income to net cash provided by (used in)operating activities: | ||
Depreciation and amortization | 16,808 | 14,599 |
Non-cash lease expense | 2,160 | 1,481 |
Gain on disposal of property and equipment | (385) | (6) |
Stock-based compensation | 16,051 | 16,332 |
Effect on cash of changes in operating assets and liabilities net of acquisition: | ||
Accounts receivable | (167,512) | (134,433) |
Inventories | 35,495 | (208,673) |
Prepaid expenses and other assets | 1,273 | (29,621) |
Prepaid income taxes | 3,986 | (5,885) |
Accounts payable | 51,124 | 18,329 |
Accrued liabilities | 14,207 | 20,603 |
Accrued promotional allowances | 48,265 | 61,171 |
Accrued compensation | (30,261) | (32,122) |
Income taxes payable | 41,617 | (9,818) |
Other liabilities | (751) | (596) |
Deferred revenue | (5,046) | (5,915) |
Net cash provided by (used in) operating activities | 424,475 | (351) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Sales of available-for-sale investments | 522,501 | 504,808 |
Purchases of available-for-sale investments | (518,751) | (441,925) |
Acquisition of CANarchy, net of cash | 0 | (330,356) |
Purchases of property and equipment | (40,100) | (21,511) |
Proceeds from sale of property and equipment | 564 | 14 |
Additions to intangibles | (3,952) | (8,419) |
Increase in other assets | (13,028) | (6,241) |
Net cash used in investing activities | (52,766) | (303,630) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
(Payments) borrowings on debt | (7,271) | 3,454 |
Issuance of common stock | 36,348 | 4,510 |
Purchases of common stock held in treasury | (35,126) | (12,187) |
Net cash used in financing activities | (6,049) | (4,223) |
Effect of exchange rate changes on cash and cash equivalents | (141) | (3,472) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 365,519 | (311,676) |
CASH AND CASH EQUIVALENTS, beginning of period | 1,307,141 | 1,326,462 |
CASH AND CASH EQUIVALENTS, end of period | 1,672,660 | 1,014,786 |
Cash paid during the period for: | ||
Interest | 96 | 91 |
Income taxes | $ 56,985 | $ 112,863 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS - SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS | ||
Accrued liabilities for intangible assets | $ 9.6 | $ 11.3 |
Accured liabilities purchased from employees | 55.3 | |
Accounts payable for purchases of equipment | $ 2.5 | $ 4 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 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-months ended March 31, 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 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 | 3 Months Ended |
Mar. 31, 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 ® TM 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 March 31, 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 March 31, 2023 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 1,021,328 $ 277,111 $ 121,994 $ 141,235 $ 1,561,668 Strategic Brands 43,043 30,951 8,983 3,381 86,358 Alcohol Brands 46,290 — — — 46,290 Other 4,614 — — — 4,614 Total Net Sales $ 1,115,275 $ 308,062 $ 130,977 $ 144,616 $ 1,698,930 Three-Months Ended March 31, 2022 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 925,680 $ 260,889 $ 110,556 $ 107,722 $ 1,404,847 Strategic Brands 53,051 30,176 6,662 2,704 92,593 Alcohol Brands 2 15,207 — — — 15,207 Other 5,927 — — — 5,927 Total Net Sales $ 999,865 $ 291,065 $ 117,218 $ 110,426 $ 1,518,574 1 Europe, Middle East and Africa (“EMEA”) 2 Effectively from February 17, 2022 to March 31, 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 March 31, 2023, the Company had $264.2 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 March 31, 2023 and 2022, $9.9 million and $10.0 million, respectively, of deferred revenue was recognized in net sales. See Note 10. |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2023 | |
LEASES | |
LEASES | 3. LEASES The Company leases identified assets comprised of real estate and equipment. Real estate leases consist primarily of office and warehouse space and equipment leases consist of vehicles and warehouse equipment. At the inception of a contract, the Company assesses whether the contract is, or contains, a lease. The Company’s assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefit from the use of the asset throughout the term, and (3) whether the Company has the right to direct the use of the asset. At inception of a lease, the Company allocates the consideration in the contract to each lease and non-lease component based on the component’s relative stand-alone price to determine the lease payments. Lease and non-lease components are accounted for separately. Leases are classified as either finance leases or operating leases based on criteria in ASC 842, “Leases”. The Company’s operating leases are comprised of real estate and warehouse equipment, and the Company’s finance leases are comprised of vehicles. Right-of-use (“ROU”) assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the Company’s leases generally do not provide an implicit rate, the Company uses its incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at the commencement date. ROU assets also include any lease payments made and exclude lease incentives. Lease terms include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Certain of the Company’s real estate leases contain variable lease payments, including payments based on an index or rate. Variable lease payments based on an index or rate are initially measured using the index or rate in effect at the lease commencement date. Additional payments based on the change in an index or rate, or payments based on a change in the Company’s portion of real estate taxes and insurance, are recorded as a period expense when incurred. Lease expense for operating leases, consisting of lease payments, is recognized on a straight-line basis over the lease term and is included in operating expenses in the consolidated statement of income. Lease expense for finance leases consists of the amortization of the ROU asset on a straight-line basis over the asset’s estimated useful life and is included in operating expenses in the consolidated statement of income. Interest expense on finance leases is calculated using the amortized cost basis and is included in other income (expense), net in the consolidated statement of income. 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 comprised of the following: Three-Months Three-Months Ended Ended March 31, March 31, 2023 2022 Operating lease cost $ 2,467 $ 1,694 Short-term lease cost 979 929 Variable lease cost 215 183 Finance leases: Amortization of ROU assets 123 127 Interest on lease liabilities 14 3 Finance lease cost 137 130 Total lease cost $ 3,798 $ 2,936 Supplemental cash flow information for the following periods: Three-Months Three-Months Ended March 31, Ended March 31, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 2,391 $ 1,652 Operating cash outflows from finance leases 14 3 Financing cash outflows from finance leases 598 592 ROU assets obtained in exchange for lease obligations: Finance leases 2,227 832 Operating leases 313 13,197 ROU assets for operating and finance leases recognized in the Company’s condensed consolidated balance sheets were comprised of the following at: March 31, 2023 Real Estate Equipment Total Balance Sheet Location Operating leases $ 35,953 $ 256 $ 36,209 Other Assets Finance leases — 3,694 3,694 Property and Equipment, net December 31, 2022 Real Estate Equipment Total Balance Sheet Location Operating leases $ 37,682 $ 330 $ 38,012 Other Assets Finance leases — 1,598 1,598 Property and Equipment, net Operating and finance lease liabilities recognized in the Company’s condensed consolidated balance sheets were as follows at: March 31, 2023 Operating Leases Finance Leases Accrued liabilities $ 7,642 $ 2,393 Other liabilities 27,958 33 Total $ 35,600 $ 2,426 December 31, 2022 Operating Leases Finance Leases Accrued liabilities $ 7,747 $ 757 Other liabilities 29,586 41 Total $ 37,333 $ 798 The weighted-average remaining lease terms and weighted-average discount rates for operating and finance leases at March 31, 2023 and December 31, 2022 were as follows: March 31, 2023 Operating Leases Finance Leases Weighted-average remaining lease term (years) 6.6 0.9 Weighted-average discount rate 3.5 % 5.7 % December 31, 2022 Operating Leases Finance Leases Weighted-average remaining lease term (years) 6.7 0.8 Weighted-average discount rate 3.4 % 3.6 % The following table reconciles the undiscounted future lease payments for operating and finance leases to the operating and finance leases recorded in the Company’s condensed consolidated balance sheet at March 31, 2023: Undiscounted Future Lease Payments Operating Leases Finance Leases 2023 (from April 1, 2023 to December 31, 2023) $ 6,626 $ 2,051 2024 7,469 423 2025 5,318 17 2026 4,181 2 2027 4,059 — 2028 and thereafter 12,352 — Total lease payments 40,005 2,493 Less imputed interest (4,405) (67) Total $ 35,600 $ 2,426 As of March 31, 2023, the Company had an additional operating lease for office and warehouse space that had not yet commenced of $1.1 million in aggregate. This operating lease will commence in June 2023 with a term of four years. As of March 31, 2023, the Company did not have any significant additional finance leases that had not yet commenced. |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 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 March 31, 2023 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 296,708 $ 1 $ 1 $ 296,708 $ 1 $ — Certificates of deposit 12,630 — — 12,630 — — Municipal securities 129,779 3 208 129,574 208 — U.S. government agency securities 129,605 35 332 129,308 332 — U.S. treasuries 744,403 156 2,180 742,379 2,180 — Corporate bonds 72,536 15 122 72,429 122 — Long-term: U.S. government agency securities 10,432 7 9 10,430 9 — U.S. treasuries 28,996 9 34 28,971 34 — Corporate bonds 1,753 — 2 1,751 2 — Total $ 1,426,842 $ 226 $ 2,888 $ 1,424,180 $ 2,888 $ — 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-months ended March 31, 2023 and 2022, realized gains or losses recognized on the sale of investments were not significant. The Company’s investments at March 31, 2023 and December 31, 2022 carried investment grade credit ratings. The following table summarizes the underlying contractual maturities of the Company’s investments at: March 31, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value Less than 1 year: Commercial paper $ 296,708 $ 296,708 $ 197,712 $ 197,710 Municipal securities 129,779 129,574 211,791 211,239 U.S. government agency securities 129,605 129,308 109,697 108,985 Certificates of deposit 12,630 12,630 10,078 10,078 U.S. treasuries 744,403 742,379 838,825 834,302 Corporate bonds 72,536 72,429 — — Due 1 -10 years: U.S. treasuries 28,996 28,971 53,215 53,164 U.S. government agency securities 10,432 10,430 2,016 2,013 Variable rate demand notes — — 4,862 4,862 Corporate bonds 1,753 1,751 — — Due 11 - 20 years: Variable rate demand notes — — 1,404 1,404 Total $ 1,426,842 $ 1,424,180 $ 1,429,600 $ 1,423,757 |
FAIR VALUE OF CERTAIN FINANCIAL
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | 3 Months Ended |
Mar. 31, 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: March 31, 2023 Level 1 Level 2 Level 3 Total Cash $ 886,785 $ — $ — $ 886,785 Money market funds 713,009 — — 713,009 Certificates of deposit — 41,050 — 41,050 Commercial paper — 310,774 — 310,774 Corporate bonds — 74,180 — 74,180 Municipal securities — 129,574 — 129,574 U.S. government agency securities — 151,678 — 151,678 U.S. treasuries — 789,790 — 789,790 Foreign currency derivatives — 77 — 77 Total $ 1,599,794 $ 1,497,123 $ — $ 3,096,917 Amounts included in: Cash and cash equivalents $ 1,599,794 $ 72,866 $ — $ 1,672,660 Short-term investments — 1,383,028 — 1,383,028 Accounts receivable, net — 382 — 382 Investments — 41,152 — 41,152 Accrued liabilities — (305) — (305) Total $ 1,599,794 $ 1,497,123 $ — $ 3,096,917 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-months ended March 31, 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 | 3 Months Ended |
Mar. 31, 2023 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 6. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The Company is exposed to foreign currency exchange rate risks related primarily to its foreign business operations. During the three-months ended March 31, 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 March 31, 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 under ASC 815, “Derivatives and Hedging.” 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 notional amount and fair value of all outstanding foreign currency derivative instruments in the Company’s condensed consolidated balance sheets consist of the following at: March 31, 2023 Derivatives not designated as hedging instruments under Notional Fair ASC 815 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive CAD/pay USD $ 44,220 $ 168 Accounts receivable, net Receive USD/pay CLP 56,610 159 Accounts receivable, net Receive USD/pay COP 15,493 37 Accounts receivable, net Receive RSD/pay USD 4,560 18 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive USD/pay EUR $ 48,377 $ (105) Accrued liabilities Receive USD/pay ZAR 4,117 (97) Accrued liabilities Receive USD/pay NZD 6,906 (32) Accrued liabilities Receive USD/pay CNY 18,642 (31) Accrued liabilities Receive USD/pay GBP 14,292 (24) Accrued liabilities Receive SGD/pay USD 24,977 (10) Accrued liabilities Receive AUD/pay USD 2,884 (6) Accrued liabilities December 31, 2022 Derivatives not designated as hedging instruments under Notional Fair ASC 815 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive SGD/pay USD $ 15,883 $ 398 Accounts receivable, net Receive CAD/pay USD 34,467 106 Accounts receivable, net Receive USD/pay MXN 12,430 88 Accounts receivable, net Receive USD/pay GBP 43,551 118 Accounts receivable, net Receive RSD/pay USD 3,513 112 Accounts receivable, net Receive GBP/pay USD 34,716 100 Accounts receivable, net Receive GBP/pay USD 4,321 31 Accounts receivable, net Receive USD/pay COP 11,570 12 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive USD/pay CLP $ 43,071 $ (2,549) Accrued liabilities Receive USD/pay EUR 40,592 (1,377) Accrued liabilities Receive USD/pay CNY 12,460 (362) Accrued liabilities Receive USD/pay EUR 34,714 (295) Accrued liabilities Receive USD/pay NZD 4,093 (91) Accrued liabilities Receive USD/pay AUD 1,271 (23) Accrued liabilities Receive USD/pay ZAR 3,124 (1) Accrued liabilities The net gains (losses) on derivative instruments in the condensed consolidated statements of income were as follows: Amount of gain (loss) recognized in income on derivatives Three-months ended Derivatives not designated as Location of gain (loss) hedging instruments under recognized in income on March 31, March 31, ASC 815 derivatives 2023 2022 Foreign currency exchange contracts Interest and other income (expense), net $ (7,852) $ (4,019) |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2023 | |
INVENTORIES | |
INVENTORIES | 7. INVENTORIES Inventories consist of the following at: March 31, December 31, 2023 2022 Raw materials $ 421,914 $ 467,392 Work in process 1,615 1,688 Finished goods 483,194 466,551 $ 906,723 $ 935,631 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 3 Months Ended |
Mar. 31, 2023 | |
PROPERTY AND EQUIPMENT, NET | |
PROPERTY AND EQUIPMENT, NET | 8. PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following at: March 31, December 31, 2023 2022 Land $ 139,922 $ 139,798 Leasehold improvements 31,753 31,327 Furniture and fixtures 9,335 9,286 Office and computer equipment 22,532 22,386 Computer software 5,310 5,906 Equipment 255,991 244,739 Buildings 164,821 163,885 Vehicles 51,675 49,175 Assets under construction 111,283 83,553 792,622 750,055 Less: accumulated depreciation and amortization (246,700) (233,158) $ 545,922 $ 516,897 Total depreciation and amortization expense was $14.8 million and $13.1 million for the three-months ended March 31, 2023 and 2022, respectively. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2023 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | 9. The following is a roll-forward of goodwill for the three-months ended March 31, 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 March 31, 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 — — 80,285 — 80,285 Balance at March 31, 2022 $ 693,644 $ 637,999 $ 80,285 $ — $ 1,411,928 Intangible assets consist of the following at: March 31, December 31, 2023 2022 Amortizing intangibles $ 121,378 $ 121,378 Accumulated amortization (70,800) (68,790) 50,578 52,588 Non-amortizing intangibles 1,172,020 1,167,822 $ 1,222,598 $ 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 March 31, 2023: 2023 (from April 1, 2023 to December 31, 2023) $ 2,736 2024 3,648 2025 3,647 2026 3,647 2027 3,646 2028 and thereafter 33,254 $ 50,578 |
DISTRIBUTION AGREEMENTS
DISTRIBUTION AGREEMENTS | 3 Months Ended |
Mar. 31, 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 $9.9 million and $10.0 million for the three-months ended March 31, 2023 and 2022, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 11. COMMITMENTS AND CONTINGENCIES The Company had purchase commitments aggregating approximately $336.8 million at March 31, 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 $380.6 million at March 31, 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 March 31, 2023, the interest rate on borrowings under the line of credit was 5.5%. As of March 31, 2023, $1.1 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 March 31, 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 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, enjoins 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 requires VPX and Mr. Owoc to issue corrective statements to consumers and non-consumer partners, including retailers and distributors. The parties have completed briefing the remaining post-verdict issues, including MEC’s request for enhanced and punitive damages. In April 2022, MEC and Orange Bang, Inc. (“Orange Bang”) filed a joint motion in the District Court 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. Pursuant to the terms of the agreement between MEC and Orange Bang, the award and future royalties will, after accounting for MEC’s expended fees and costs, be shared equally between MEC and Orange Bang. 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 award. On October 28, 2022, VPX filed a notice of appeal of the District Court’s final judgment confirming the 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 final arbitration award is 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. This payment is subject to potential claw back if, among other things, the judgment and final arbitration award are overturned on appeal or VPX becomes administratively insolvent. In addition, per ASC 450 “Contingencies”, the Company will not recognize the September 2022 jury award or the April 2022 arbitration award until the awards are realized or realizable. As of May 5, 2023, the proceedings have yet to progress to a stage where there is sufficient information for an accurate timeline of when the awards, including any royalty payments received, will be realized or realizable, if at all. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 3 Months Ended |
Mar. 31, 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 three-months ended March 31, 2023 and 2022 are as follows: Unrealized Currency Gains (Losses) Translation on Available-for- Losses Sale Securities Total Balance at December 31, 2022 $ (153,230) $ (5,843) $ (159,073) Other comprehensive income before reclassifications 7,981 3,181 11,162 Net current-period other comprehensive income 7,981 3,181 11,162 Balance at March 31, 2023 $ (145,249) $ (2,662) $ (147,911) Unrealized Currency Gains (Losses) Translation on Available-for- Losses Sale Securities Total Balance at December 31, 2021 $ (68,209) $ (956) $ (69,165) Other comprehensive (loss) income before reclassifications 1,079 (4,059) (2,980) Net current-period other comprehensive (loss) income 1,079 (4,059) (2,980) Balance at March 31, 2022 $ (67,130) $ (5,015) $ (72,145) |
TREASURY STOCK
TREASURY STOCK | 3 Months Ended |
Mar. 31, 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 March 31, 2023, no shares were repurchased under the June 2022 Repurchase Plan. As of May 5, 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 March 31, 2023, no shares were repurchased under the November 2022 Repurchase Plan. As of May 5, 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 May 5, 2023. During the three-months ended March 31, 2023, 1.7 million 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 $90.4 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 March 31, 2023. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 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 March 31, 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 $16.1 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 March 31, 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 March 31, 2023 and 2022 was $25.9 million and $0.4 million, respectively. Stock Options Under the Company’s stock-based compensation plans, all stock options granted as of March 31, 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 March 31, 2023 2022 Dividend yield 0.0 % 0.0 % Expected volatility 27.6 % 27.7 % Risk-free interest rate 3.7 % 2.1 % Expected term 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 Exercised (3,129) $ 11.62 Cancelled or forfeited (73) $ 37.39 Outstanding at March 31, 2023 30,470 $ 31.04 5.8 $ 699,802 Vested and expected to vest in the future at March 31, 2023 29,381 $ 30.58 5.6 $ 688,532 Exercisable at March 31, 2023 19,309 $ 24.79 4.0 $ 564,190 The weighted-average grant-date fair value of options granted during the three-months ended March 31, 2023 and 2022 was $18.23 per share and $11.61 per share, respectively. The total intrinsic value of options exercised during the three-months ended March 31, 2023 and 2022 was $131.0 million and $4.9 million, respectively. Cash received from option exercises under all plans for the three-months ended March 31, 2023 and 2022 was $36.3 million and $4.5 million, respectively. At March 31, 2023, there was $125.2 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 3.6 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 Vested (576) $ 32.87 Forfeited/cancelled (4) $ 32.80 Non-vested at March 31, 2023 1,969 $ 40.52 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 March 31, 2023 and 2022 was $50.83 and $36.73 per share, respectively. As of March 31, 2023, 1.8 million of restricted stock units and performance share units are expected to vest over their respective terms. At March 31, 2023, total unrecognized compensation expense relating to non-vested restricted stock units and performance share units was $53.6 million, which is expected to be recognized over a weighted-average period of 1.9 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 March 31, 2023, other share-based awards outstanding included grants that vest over three years payable in the first quarters of 2024, 2025 and 2026. At March 31, 2023, there was $0.3 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 cost is expected to be recognized over a weighted-average period of 1.4 years. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 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 three-months ended March 31, 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 March 31, 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 March 31, 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 2021 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 2021 tax years. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Mar. 31, 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 March 31, 2023 2022 Weighted-average shares outstanding: Basic 1,044,909 1,058,810 Dilutive 14,160 12,298 Diluted 1,059,069 1,071,108 For the three-months ended March 31, 2023 and 2022, options and awards outstanding totaling 2.6 million shares and 3.2 million shares, respectively, were excluded from the calculations as their effect would have been antidilutive. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2023 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 17. SEGMENT INFORMATION The Company has four operating and reportable ® TM 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 will have 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-months ended March 31, 2023 and 2022 were as follows: Three-Months Ended March 31, 2023 2022 Net sales: Monster Energy® Drinks 1 $ 1,561,669 $ 1,404,847 Strategic Brands 86,357 92,593 Alcohol Brands 2 46,290 15,207 Other 4,614 5,927 Corporate and unallocated — — $ 1,698,930 $ 1,518,574 Three-Months Ended March 31, 2023 2022 Operating Income: Monster Energy® Drinks 1 $ 560,819 $ 454,563 Strategic Brands 51,771 57,195 Alcohol Brands 2 (6,883) (4,953) Other (293) 1,127 Corporate and unallocated (120,350) (108,443) $ 485,064 $ 399,489 Three-Months Ended March 31, 2023 2022 Income before tax: Monster Energy® Drinks 1 $ 561,674 $ 455,134 Strategic Brands 51,788 57,254 Alcohol Brands 2 (6,867) (5,606) Other (293) 1,137 Corporate and unallocated (108,742) (115,730) $ 497,560 $ 392,189 (1) Includes $9.9 million and $10.0 million for the three-months ended March 31, 2023 and 2022, respectively, related to the recognition of deferred revenue. (2) For the three-months ended March 31, 2022, effectively from February 17, 2022 to March 31, 2022. Three-Months Ended March 31, 2023 2022 Depreciation and amortization: Monster Energy® Drinks $ 8,989 $ 8,159 Strategic Brands 221 233 Alcohol Brands 4,051 2,283 Other 1,123 1,110 Corporate and unallocated 2,424 2,814 $ 16,808 $ 14,599 Corporate and unallocated expenses for the three-months ended March 31, 2023 include $80.3 million of payroll costs, of which $15.7 million was attributable to stock-based compensation expenses (see Note 14 “Stock-Based Compensation”), as well as $22.1 million attributable to professional service expenses, including accounting and legal costs, and $18.0 million of other operating expenses. Corporate and unallocated expenses for the three-months ended March 31, 2022 include $68.1 million of payroll costs, of which $16.2 million was attributable to stock-based compensation expenses (see Note 14 “Stock-Based Compensation”), as well as $26.4 million attributable to professional service expenses, including accounting and legal costs, and $13.9 million of other operating expenses. Coca-Cola Europacific Partners accounted for approximately 13% and 12% of the Company’s net sales for the three-months ended March 31, 2023 and 2022, respectively. Coca-Cola Consolidated, Inc. accounted for approximately 10% and 9% of the Company’s net sales for the three-months ended March 31, 2023 and 2022, respectively. Reyes Coca-Cola Bottling, LLC accounted for approximately 9% and 10% of the Company’s net sales for the three-months ended March 31, 2023 and 2022, respectively. Net sales to customers outside the United States amounted to $622.9 million and $553.4 million for the three-months ended March 31, 2023 and 2022, respectively. Such sales were approximately 37% and 36% of net sales for the three-months ended March 31, 2023 and 2022, respectively. Goodwill and other intangible assets for the Company’s reportable segments as of March 31, 2023 and December 31, 2022 were as follows: March 31, December 31, 2023 2022 Goodwill and other intangible assets: Monster Energy® Drinks $ 1,427,947 $ 1,424,212 Strategic Brands 980,360 979,896 Alcohol Brands 232,232 233,140 Other — 1,103 $ 2,640,539 $ 2,638,351 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 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 $15.7 million and $18.4 million for the three-months ended March 31, 2023 and 2022, respectively, and are included as a reduction to net sales. TCCC commissions, based on sales to TCCC independent bottlers/distributors, were $8.8 million and $11.0 million for the three-months ended March 31, 2023 and 2022, respectively, and are included in operating expenses. Net sales to the TCCC Subsidiaries for the three-months ended March 31, 2023 and 2022 were $35.1 million and $31.8 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 $6.5 million and $8.5 million for the three-months ended March 31, 2023 and 2022, respectively. Certain TCCC Subsidiaries also contract manufacture certain of the Company’s energy drinks. Such contract manufacturing expenses were $7.4 million and $9.2 million for the three-months ended March 31, 2023 and 2022, respectively. Accounts receivable, accounts payable, accrued promotional allowances and accrued liabilities related to the TCCC Subsidiaries were as follows at: March 31, December 31, 2023 2022 Accounts receivable, net $ 128,697 $ 88,169 Accounts payable $ (36,703) $ (35,467) Accrued promotional allowances $ (10,833) $ (11,222) Accrued liabilities $ (23,569) $ (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 both the three-months ended March 31, 2023 and 2022 was $1.1 million. During the three-months ended March 31, 2022, the Company occasionally chartered 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 was accompanied by guests and other Company personnel when using such aircraft for business travel. During the three-months ended March 31, 2022, the Company incurred costs of $0.08 million, an amount the Company believes is commensurate with market rates for comparable travel. No amounts were incurred by the Company during the three-months ended March 31, 2023. 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. |
ORGANIZATION AND SUMMARY OF SIG
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 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) | 3 Months Ended |
Mar. 31, 2023 | |
REVENUE RECOGNITION | |
Schedule of disaggregation of revenue by geographical markets | Three-Months Ended March 31, 2023 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 1,021,328 $ 277,111 $ 121,994 $ 141,235 $ 1,561,668 Strategic Brands 43,043 30,951 8,983 3,381 86,358 Alcohol Brands 46,290 — — — 46,290 Other 4,614 — — — 4,614 Total Net Sales $ 1,115,275 $ 308,062 $ 130,977 $ 144,616 $ 1,698,930 Three-Months Ended March 31, 2022 Latin America U.S. and and Net Sales Canada EMEA 1 Asia Pacific Caribbean Total Monster Energy® Drinks $ 925,680 $ 260,889 $ 110,556 $ 107,722 $ 1,404,847 Strategic Brands 53,051 30,176 6,662 2,704 92,593 Alcohol Brands 2 15,207 — — — 15,207 Other 5,927 — — — 5,927 Total Net Sales $ 999,865 $ 291,065 $ 117,218 $ 110,426 $ 1,518,574 1 Europe, Middle East and Africa (“EMEA”) 2 Effectively from February 17, 2022 to March 31, 2022 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
LEASES | |
Schedule of lease cost | Three-Months Three-Months Ended Ended March 31, March 31, 2023 2022 Operating lease cost $ 2,467 $ 1,694 Short-term lease cost 979 929 Variable lease cost 215 183 Finance leases: Amortization of ROU assets 123 127 Interest on lease liabilities 14 3 Finance lease cost 137 130 Total lease cost $ 3,798 $ 2,936 |
Schedule of supplemental cash flow information for leases | Three-Months Three-Months Ended March 31, Ended March 31, 2023 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 2,391 $ 1,652 Operating cash outflows from finance leases 14 3 Financing cash outflows from finance leases 598 592 ROU assets obtained in exchange for lease obligations: Finance leases 2,227 832 Operating leases 313 13,197 |
Schedule of ROU assets for operating and finance leases | March 31, 2023 Real Estate Equipment Total Balance Sheet Location Operating leases $ 35,953 $ 256 $ 36,209 Other Assets Finance leases — 3,694 3,694 Property and Equipment, net December 31, 2022 Real Estate Equipment Total Balance Sheet Location Operating leases $ 37,682 $ 330 $ 38,012 Other Assets Finance leases — 1,598 1,598 Property and Equipment, net |
Summary of operating and finance lease liabilities recognized in the condensed consolidated balance sheets | March 31, 2023 Operating Leases Finance Leases Accrued liabilities $ 7,642 $ 2,393 Other liabilities 27,958 33 Total $ 35,600 $ 2,426 December 31, 2022 Operating Leases Finance Leases Accrued liabilities $ 7,747 $ 757 Other liabilities 29,586 41 Total $ 37,333 $ 798 |
Schedule of weighted-average remaining lease terms and weighted-average discount rates | March 31, 2023 Operating Leases Finance Leases Weighted-average remaining lease term (years) 6.6 0.9 Weighted-average discount rate 3.5 % 5.7 % December 31, 2022 Operating Leases Finance Leases Weighted-average remaining lease term (years) 6.7 0.8 Weighted-average discount rate 3.4 % 3.6 % |
Schedule of reconciliation of undiscounted future lease payments for operating and finance leases | Undiscounted Future Lease Payments Operating Leases Finance Leases 2023 (from April 1, 2023 to December 31, 2023) $ 6,626 $ 2,051 2024 7,469 423 2025 5,318 17 2026 4,181 2 2027 4,059 — 2028 and thereafter 12,352 — Total lease payments 40,005 2,493 Less imputed interest (4,405) (67) Total $ 35,600 $ 2,426 |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 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 March 31, 2023 Cost Gains Losses Value Months Months Available-for-sale Short-term: Commercial paper $ 296,708 $ 1 $ 1 $ 296,708 $ 1 $ — Certificates of deposit 12,630 — — 12,630 — — Municipal securities 129,779 3 208 129,574 208 — U.S. government agency securities 129,605 35 332 129,308 332 — U.S. treasuries 744,403 156 2,180 742,379 2,180 — Corporate bonds 72,536 15 122 72,429 122 — Long-term: U.S. government agency securities 10,432 7 9 10,430 9 — U.S. treasuries 28,996 9 34 28,971 34 — Corporate bonds 1,753 — 2 1,751 2 — Total $ 1,426,842 $ 226 $ 2,888 $ 1,424,180 $ 2,888 $ — 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 | March 31, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value Less than 1 year: Commercial paper $ 296,708 $ 296,708 $ 197,712 $ 197,710 Municipal securities 129,779 129,574 211,791 211,239 U.S. government agency securities 129,605 129,308 109,697 108,985 Certificates of deposit 12,630 12,630 10,078 10,078 U.S. treasuries 744,403 742,379 838,825 834,302 Corporate bonds 72,536 72,429 — — Due 1 -10 years: U.S. treasuries 28,996 28,971 53,215 53,164 U.S. government agency securities 10,432 10,430 2,016 2,013 Variable rate demand notes — — 4,862 4,862 Corporate bonds 1,753 1,751 — — Due 11 - 20 years: Variable rate demand notes — — 1,404 1,404 Total $ 1,426,842 $ 1,424,180 $ 1,429,600 $ 1,423,757 |
FAIR VALUE OF CERTAIN FINANCI_2
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | |
Schedule of financial assets and liabilities recorded at fair value on a recurring basis | March 31, 2023 Level 1 Level 2 Level 3 Total Cash $ 886,785 $ — $ — $ 886,785 Money market funds 713,009 — — 713,009 Certificates of deposit — 41,050 — 41,050 Commercial paper — 310,774 — 310,774 Corporate bonds — 74,180 — 74,180 Municipal securities — 129,574 — 129,574 U.S. government agency securities — 151,678 — 151,678 U.S. treasuries — 789,790 — 789,790 Foreign currency derivatives — 77 — 77 Total $ 1,599,794 $ 1,497,123 $ — $ 3,096,917 Amounts included in: Cash and cash equivalents $ 1,599,794 $ 72,866 $ — $ 1,672,660 Short-term investments — 1,383,028 — 1,383,028 Accounts receivable, net — 382 — 382 Investments — 41,152 — 41,152 Accrued liabilities — (305) — (305) Total $ 1,599,794 $ 1,497,123 $ — $ 3,096,917 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) | 3 Months Ended |
Mar. 31, 2023 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | |
Schedule of notional amount and fair value of all outstanding foreign currency derivative instruments in the consolidated balance sheets | March 31, 2023 Derivatives not designated as hedging instruments under Notional Fair ASC 815 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive CAD/pay USD $ 44,220 $ 168 Accounts receivable, net Receive USD/pay CLP 56,610 159 Accounts receivable, net Receive USD/pay COP 15,493 37 Accounts receivable, net Receive RSD/pay USD 4,560 18 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive USD/pay EUR $ 48,377 $ (105) Accrued liabilities Receive USD/pay ZAR 4,117 (97) Accrued liabilities Receive USD/pay NZD 6,906 (32) Accrued liabilities Receive USD/pay CNY 18,642 (31) Accrued liabilities Receive USD/pay GBP 14,292 (24) Accrued liabilities Receive SGD/pay USD 24,977 (10) Accrued liabilities Receive AUD/pay USD 2,884 (6) Accrued liabilities December 31, 2022 Derivatives not designated as hedging instruments under Notional Fair ASC 815 Amount Value Balance Sheet Location Assets: Foreign currency exchange contracts: Receive SGD/pay USD $ 15,883 $ 398 Accounts receivable, net Receive CAD/pay USD 34,467 106 Accounts receivable, net Receive USD/pay MXN 12,430 88 Accounts receivable, net Receive USD/pay GBP 43,551 118 Accounts receivable, net Receive RSD/pay USD 3,513 112 Accounts receivable, net Receive GBP/pay USD 34,716 100 Accounts receivable, net Receive GBP/pay USD 4,321 31 Accounts receivable, net Receive USD/pay COP 11,570 12 Accounts receivable, net Liabilities: Foreign currency exchange contracts: Receive USD/pay CLP $ 43,071 $ (2,549) Accrued liabilities Receive USD/pay EUR 40,592 (1,377) Accrued liabilities Receive USD/pay CNY 12,460 (362) Accrued liabilities Receive USD/pay EUR 34,714 (295) Accrued liabilities Receive USD/pay NZD 4,093 (91) Accrued liabilities Receive USD/pay AUD 1,271 (23) Accrued liabilities Receive USD/pay ZAR 3,124 (1) Accrued liabilities |
Schedule of net loss on derivative instruments in the consolidated statements of income | Amount of gain (loss) recognized in income on derivatives Three-months ended Derivatives not designated as Location of gain (loss) hedging instruments under recognized in income on March 31, March 31, ASC 815 derivatives 2023 2022 Foreign currency exchange contracts Interest and other income (expense), net $ (7,852) $ (4,019) |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
INVENTORIES | |
Schedule of inventories | March 31, December 31, 2023 2022 Raw materials $ 421,914 $ 467,392 Work in process 1,615 1,688 Finished goods 483,194 466,551 $ 906,723 $ 935,631 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
PROPERTY AND EQUIPMENT, NET | |
Schedule of property and equipment | March 31, December 31, 2023 2022 Land $ 139,922 $ 139,798 Leasehold improvements 31,753 31,327 Furniture and fixtures 9,335 9,286 Office and computer equipment 22,532 22,386 Computer software 5,310 5,906 Equipment 255,991 244,739 Buildings 164,821 163,885 Vehicles 51,675 49,175 Assets under construction 111,283 83,553 792,622 750,055 Less: accumulated depreciation and amortization (246,700) (233,158) $ 545,922 $ 516,897 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 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 March 31, 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 — — 80,285 — 80,285 Balance at March 31, 2022 $ 693,644 $ 637,999 $ 80,285 $ — $ 1,411,928 |
Schedule of intangible assets | March 31, December 31, 2023 2022 Amortizing intangibles $ 121,378 $ 121,378 Accumulated amortization (70,800) (68,790) 50,578 52,588 Non-amortizing intangibles 1,172,020 1,167,822 $ 1,222,598 $ 1,220,410 |
Schedule of future estimated amortization expense related to amortizing intangibles | 2023 (from April 1, 2023 to December 31, 2023) $ 2,736 2024 3,648 2025 3,647 2026 3,647 2027 3,646 2028 and thereafter 33,254 $ 50,578 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | |
Schedule of components of accumulated other comprehensive loss | Unrealized Currency Gains (Losses) Translation on Available-for- Losses Sale Securities Total Balance at December 31, 2022 $ (153,230) $ (5,843) $ (159,073) Other comprehensive income before reclassifications 7,981 3,181 11,162 Net current-period other comprehensive income 7,981 3,181 11,162 Balance at March 31, 2023 $ (145,249) $ (2,662) $ (147,911) Unrealized Currency Gains (Losses) Translation on Available-for- Losses Sale Securities Total Balance at December 31, 2021 $ (68,209) $ (956) $ (69,165) Other comprehensive (loss) income before reclassifications 1,079 (4,059) (2,980) Net current-period other comprehensive (loss) income 1,079 (4,059) (2,980) Balance at March 31, 2022 $ (67,130) $ (5,015) $ (72,145) |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
STOCK-BASED COMPENSATION | |
Schedule of weighted-average assumptions used to estimate the fair value of options granted | Three-Months Ended March 31, 2023 2022 Dividend yield 0.0 % 0.0 % Expected volatility 27.6 % 27.7 % Risk-free interest rate 3.7 % 2.1 % Expected term 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 Exercised (3,129) $ 11.62 Cancelled or forfeited (73) $ 37.39 Outstanding at March 31, 2023 30,470 $ 31.04 5.8 $ 699,802 Vested and expected to vest in the future at March 31, 2023 29,381 $ 30.58 5.6 $ 688,532 Exercisable at March 31, 2023 19,309 $ 24.79 4.0 $ 564,190 |
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 Vested (576) $ 32.87 Forfeited/cancelled (4) $ 32.80 Non-vested at March 31, 2023 1,969 $ 40.52 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) | 3 Months Ended |
Mar. 31, 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 March 31, 2023 $ 3,758 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 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 March 31, 2023 2022 Weighted-average shares outstanding: Basic 1,044,909 1,058,810 Dilutive 14,160 12,298 Diluted 1,059,069 1,071,108 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
SEGMENT INFORMATION | |
Schedule of net revenues and other financial information by segment | Three-Months Ended March 31, 2023 2022 Net sales: Monster Energy® Drinks 1 $ 1,561,669 $ 1,404,847 Strategic Brands 86,357 92,593 Alcohol Brands 2 46,290 15,207 Other 4,614 5,927 Corporate and unallocated — — $ 1,698,930 $ 1,518,574 Three-Months Ended March 31, 2023 2022 Operating Income: Monster Energy® Drinks 1 $ 560,819 $ 454,563 Strategic Brands 51,771 57,195 Alcohol Brands 2 (6,883) (4,953) Other (293) 1,127 Corporate and unallocated (120,350) (108,443) $ 485,064 $ 399,489 Three-Months Ended March 31, 2023 2022 Income before tax: Monster Energy® Drinks 1 $ 561,674 $ 455,134 Strategic Brands 51,788 57,254 Alcohol Brands 2 (6,867) (5,606) Other (293) 1,137 Corporate and unallocated (108,742) (115,730) $ 497,560 $ 392,189 (1) Includes $9.9 million and $10.0 million for the three-months ended March 31, 2023 and 2022, respectively, related to the recognition of deferred revenue. (2) For the three-months ended March 31, 2022, effectively from February 17, 2022 to March 31, 2022. Three-Months Ended March 31, 2023 2022 Depreciation and amortization: Monster Energy® Drinks $ 8,989 $ 8,159 Strategic Brands 221 233 Alcohol Brands 4,051 2,283 Other 1,123 1,110 Corporate and unallocated 2,424 2,814 $ 16,808 $ 14,599 |
Schedule of goodwill and other intangible assets for the reportable segments | March 31, December 31, 2023 2022 Goodwill and other intangible assets: Monster Energy® Drinks $ 1,427,947 $ 1,424,212 Strategic Brands 980,360 979,896 Alcohol Brands 232,232 233,140 Other — 1,103 $ 2,640,539 $ 2,638,351 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party transactions | March 31, December 31, 2023 2022 Accounts receivable, net $ 128,697 $ 88,169 Accounts payable $ (36,703) $ (35,467) Accrued promotional allowances $ (10,833) $ (11,222) Accrued liabilities $ (23,569) $ (14,733) |
BASIS OF PRESENTATION (Details)
BASIS OF PRESENTATION (Details) shares in Millions, $ in Millions | Mar. 10, 2023 USD ($) shares | Feb. 28, 2023 |
Stock split ratio | 2 | |
Stock dividend (in percent) | 100% | |
Treasury stock [Member] | ||
Number of shares retired | shares | 170 | |
Carrying value of shares retired | $ | $ 4,690 |
REVENUE RECOGNITION - (Details)
REVENUE RECOGNITION - (Details) | 3 Months Ended |
Mar. 31, 2023 segment | |
REVENUE RECOGNITION | |
Number of operating segments | 4 |
Number of reportable segments | 4 |
Distribution agreement, revenue recognition period | 20 years |
REVENUE RECOGNITION - Disaggreg
REVENUE RECOGNITION - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Total Net Sales | $ 1,698,930 | $ 1,518,574 |
U.S. and Canada | ||
Total Net Sales | 1,115,275 | 999,865 |
EMEA | ||
Total Net Sales | 308,062 | 291,065 |
Asia Pacific | ||
Total Net Sales | 130,977 | 117,218 |
Latin America and Caribbean | ||
Total Net Sales | 144,616 | 110,426 |
Monster Energy Drinks | ||
Total Net Sales | 1,561,668 | 1,404,847 |
Monster Energy Drinks | U.S. and Canada | ||
Total Net Sales | 1,021,328 | 925,680 |
Monster Energy Drinks | EMEA | ||
Total Net Sales | 277,111 | 260,889 |
Monster Energy Drinks | Asia Pacific | ||
Total Net Sales | 121,994 | 110,556 |
Monster Energy Drinks | Latin America and Caribbean | ||
Total Net Sales | 141,235 | 107,722 |
Strategic Brands | ||
Total Net Sales | 86,358 | 92,593 |
Strategic Brands | U.S. and Canada | ||
Total Net Sales | 43,043 | 53,051 |
Strategic Brands | EMEA | ||
Total Net Sales | 30,951 | 30,176 |
Strategic Brands | Asia Pacific | ||
Total Net Sales | 8,983 | 6,662 |
Strategic Brands | Latin America and Caribbean | ||
Total Net Sales | 3,381 | 2,704 |
Other | ||
Total Net Sales | 4,614 | 5,927 |
Other | U.S. and Canada | ||
Total Net Sales | 4,614 | 5,927 |
Other | EMEA | ||
Total Net Sales | 0 | 0 |
Other | Asia Pacific | ||
Total Net Sales | 0 | 0 |
Other | Latin America and Caribbean | ||
Total Net Sales | 0 | 0 |
Alcohol Brands | ||
Total Net Sales | 46,290 | 15,207 |
Alcohol Brands | U.S. and Canada | ||
Total Net Sales | 46,290 | 15,207 |
Alcohol Brands | EMEA | ||
Total Net Sales | 0 | 0 |
Alcohol Brands | Asia Pacific | ||
Total Net Sales | 0 | 0 |
Alcohol Brands | Latin America and Caribbean | ||
Total Net Sales | $ 0 | $ 0 |
REVENUE RECOGNITION - Contract
REVENUE RECOGNITION - Contract Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Contract Liabilities | |||
Deferred revenue | $ 264.2 | $ 267.1 | |
Deferred revenue recognized in net sales | $ 9.9 | $ 10 |
LEASES - Lease Terms (Details)
LEASES - Lease Terms (Details) | 3 Months Ended |
Mar. 31, 2023 | |
LEASES | |
Operating leases, lease term (in years) | 4 years |
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) | 12 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 | |
Mar. 31, 2023 | Mar. 31, 2022 | |
LEASES | ||
Operating lease cost | $ 2,467 | $ 1,694 |
Short-term lease cost | 979 | 929 |
Variable lease cost | 215 | 183 |
Finance leases: | ||
Amortization of ROU assets | 123 | 127 |
Interest on lease liabilities | 14 | 3 |
Finance lease cost | 137 | 130 |
Total lease cost | $ 3,798 | $ 2,936 |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash outflows from operating leases | $ 2,391 | $ 1,652 |
Operating cash outflows from finance leases | 14 | 3 |
Financing cash outflows from finance leases | 598 | 592 |
ROU assets obtained in exchange for lease obligations: | ||
Finance leases | 2,227 | 832 |
Operating leases | $ 313 | $ 13,197 |
LEASES - ROU assets for operati
LEASES - ROU assets for operating and finance leases (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
LEASES | ||
Operating leases | $ 36,209 | $ 38,012 |
Finance leases | $ 3,694 | $ 1,598 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other Assets, Noncurrent | Other Assets, Noncurrent |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant and Equipment, Net | Property, Plant and Equipment, Net |
Real Estate | ||
LEASES | ||
Operating leases | $ 35,953 | $ 37,682 |
Finance leases | 0 | 0 |
Equipment | ||
LEASES | ||
Operating leases | 256 | 330 |
Finance leases | $ 3,694 | $ 1,598 |
LEASES - Operating and finance
LEASES - Operating and finance leases liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
LEASES | ||
Operating Leases | $ 35,600 | $ 37,333 |
Finance Leases | 2,426 | 798 |
Accrued liabilities | ||
LEASES | ||
Operating Leases | 7,642 | 7,747 |
Finance Leases | $ 2,393 | $ 757 |
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Accrued Liabilities, Current | Accrued Liabilities, Current |
Other Liabilities | ||
LEASES | ||
Operating Leases | $ 27,958 | $ 29,586 |
Finance Leases | $ 33 | $ 41 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent |
LEASES - Weighted-average remai
LEASES - Weighted-average remaining lease term and weighted-average discount rate (Details) | Mar. 31, 2023 | Dec. 31, 2022 |
LEASES | ||
Weighted-average remaining lease term (years), Operating Leases | 6 years 7 months 6 days | 6 years 8 months 12 days |
Weighted-average remaining lease term (years), Finance Leases | 10 months 24 days | 9 months 18 days |
Weighted-average discount rate, Operating Leases | 3.50% | 3.40% |
Weighted-average discount rate, Finance Leases | 5.70% | 3.60% |
LEASES - Undiscounted future le
LEASES - Undiscounted future lease payments for operating and finance leases (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Operating Leases | ||
2023 | $ 6,626 | |
2024 | 7,469 | |
2025 | 5,318 | |
2026 | 4,181 | |
2027 | 4,059 | |
2027 and thereafter | 12,352 | |
Total lease payments | 40,005 | |
Less imputed interest | (4,405) | |
Operating Lease, Liability, Total | 35,600 | $ 37,333 |
Finance Leases | ||
2023 | 2,051 | |
2024 | 423 | |
2025 | 17 | |
2026 | 2 | |
2027 and thereafter | 0 | |
Total lease payments | 2,493 | |
Less imputed interest | (67) | |
Finance Lease, Liability, Total | 2,426 | $ 798 |
Additional operating leases | $ 1,100 | |
Operating leases, lease term (in years) | 4 years |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Available-for-sale | ||
Amortized Cost | $ 1,426,842 | $ 1,429,600 |
Gross Unrealized Holding Gains | 226 | 101 |
Gross Unrealized Holding Losses | 2,888 | 5,944 |
Fair Value | 1,424,180 | 1,423,757 |
Continuous Unrealized Loss Position less than 12 Months | 2,888 | 5,944 |
Short-term | Commercial paper | ||
Available-for-sale | ||
Amortized Cost | 296,708 | 197,712 |
Gross Unrealized Holding Gains | 1 | 1 |
Gross Unrealized Holding Losses | 1 | 4 |
Fair Value | 296,708 | 197,709 |
Continuous Unrealized Loss Position less than 12 Months | 1 | 4 |
Short-term | Certificates of deposit | ||
Available-for-sale | ||
Amortized Cost | 12,630 | 10,078 |
Fair Value | 12,630 | 10,078 |
Short-term | Municipal securities | ||
Available-for-sale | ||
Amortized Cost | 129,779 | 211,791 |
Gross Unrealized Holding Gains | 3 | 60 |
Gross Unrealized Holding Losses | 208 | 612 |
Fair Value | 129,574 | 211,239 |
Continuous Unrealized Loss Position less than 12 Months | 208 | 612 |
Short-term | Corporate bonds | ||
Available-for-sale | ||
Amortized Cost | 72,536 | |
Gross Unrealized Holding Gains | 15 | |
Gross Unrealized Holding Losses | 122 | |
Fair Value | 72,429 | |
Continuous Unrealized Loss Position less than 12 Months | 122 | |
Short-term | U.S. government agency securities | ||
Available-for-sale | ||
Amortized Cost | 129,605 | 109,697 |
Gross Unrealized Holding Gains | 35 | 3 |
Gross Unrealized Holding Losses | 332 | 715 |
Fair Value | 129,308 | 108,985 |
Continuous Unrealized Loss Position less than 12 Months | 332 | 715 |
Short-term | U.S. treasuries | ||
Available-for-sale | ||
Amortized Cost | 744,403 | 838,825 |
Gross Unrealized Holding Gains | 156 | 17 |
Gross Unrealized Holding Losses | 2,180 | 4,539 |
Fair Value | 742,379 | 834,303 |
Continuous Unrealized Loss Position less than 12 Months | 2,180 | 4,539 |
Long-term | Corporate bonds | ||
Available-for-sale | ||
Amortized Cost | 1,753 | |
Gross Unrealized Holding Losses | 2 | |
Fair Value | 1,751 | |
Continuous Unrealized Loss Position less than 12 Months | 2 | |
Long-term | U.S. government agency securities | ||
Available-for-sale | ||
Amortized Cost | 10,432 | 2,016 |
Gross Unrealized Holding Gains | 7 | |
Gross Unrealized Holding Losses | 9 | 3 |
Fair Value | 10,430 | 2,013 |
Continuous Unrealized Loss Position less than 12 Months | 9 | 3 |
Long-term | U.S. treasuries | ||
Available-for-sale | ||
Amortized Cost | 28,996 | 53,215 |
Gross Unrealized Holding Gains | 9 | 20 |
Gross Unrealized Holding Losses | 34 | 71 |
Fair Value | 28,971 | 53,164 |
Continuous Unrealized Loss Position less than 12 Months | $ 34 | 71 |
Long-term | Variable rate demand notes | ||
Available-for-sale | ||
Amortized Cost | 6,266 | |
Fair Value | $ 6,266 |
INVESTMENTS - Maturity Period (
INVESTMENTS - Maturity Period (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
INVESTMENTS | ||
Amortized Cost | $ 1,426,842 | $ 1,429,600 |
Fair Value | 1,424,180 | 1,423,757 |
Commercial paper | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 296,708 | 197,712 |
Fair Value | 296,708 | 197,710 |
Municipal securities | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 129,779 | 211,791 |
Fair Value | 129,574 | 211,239 |
Corporate bonds | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 72,536 | |
Fair Value | 72,429 | |
Corporate bonds | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 1,753 | |
Fair Value | 1,751 | |
U.S. government agency securities | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 129,605 | 109,697 |
Fair Value | 129,308 | 108,985 |
U.S. government agency securities | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 10,432 | 2,016 |
Fair Value | 10,430 | 2,013 |
Certificates of deposit | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 12,630 | 10,078 |
Fair Value | 12,630 | 10,078 |
U.S. treasuries | Less than 1 year | ||
INVESTMENTS | ||
Amortized Cost | 744,403 | 838,825 |
Fair Value | 742,379 | 834,302 |
U.S. treasuries | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 28,996 | 53,215 |
Fair Value | $ 28,971 | 53,164 |
Variable rate demand notes | Due 1 - 10 years | ||
INVESTMENTS | ||
Amortized Cost | 4,862 | |
Fair Value | 4,862 | |
Variable rate demand notes | Due 11 - 20 years | ||
INVESTMENTS | ||
Amortized Cost | 1,404 | |
Fair Value | $ 1,404 |
FAIR VALUE OF CERTAIN FINANCI_3
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Cash and cash equivalents | $ 1,672,660 | $ 1,307,141 |
Short-term investments | 1,383,028 | 1,362,314 |
Investments | 41,152 | 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 | 886,785 | 1,132,509 |
Foreign currency derivatives | 77 | (3,733) |
Assets measured at fair value | 3,096,917 | 2,727,165 |
Cash and cash equivalents | 1,672,660 | 1,307,141 |
Short-term investments | 1,383,028 | 1,362,314 |
Accounts receivable, net | 382 | 965 |
Investments | 41,152 | 61,443 |
Accrued liabilities | (305) | (4,698) |
Total fair value | Money market funds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 713,009 | 121,444 |
Total fair value | Certificates of deposit | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 41,050 | 10,078 |
Total fair value | Commercial paper | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 310,774 | 225,067 |
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 | Municipal securities | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 129,574 | 213,798 |
Total fair value | Corporate bonds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 74,180 | |
Total fair value | U.S. government agency securities | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 151,678 | 113,357 |
Total fair value | U.S. treasuries | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 789,790 | 908,379 |
Level 1 | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Cash | 886,785 | 1,132,509 |
Foreign currency derivatives | 0 | 0 |
Assets measured at fair value | 1,599,794 | 1,253,953 |
Cash and cash equivalents | 1,599,794 | 1,253,953 |
Short-term investments | 0 | 0 |
Accounts receivable, net | 0 | 0 |
Investments | 0 | 0 |
Accrued liabilities | 0 | 0 |
Level 1 | Money market funds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 713,009 | 121,444 |
Level 1 | Certificates of deposit | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | 0 |
Level 1 | Commercial paper | ||
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 |
Level 1 | Corporate bonds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | |
Level 1 | U.S. government agency securities | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | 0 |
Level 1 | U.S. treasuries | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | 0 |
Level 2 | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Cash | 0 | 0 |
Foreign currency derivatives | 77 | (3,733) |
Assets measured at fair value | 1,497,123 | 1,473,212 |
Cash and cash equivalents | 72,866 | 53,188 |
Short-term investments | 1,383,028 | 1,362,314 |
Accounts receivable, net | 382 | 965 |
Investments | 41,152 | 61,443 |
Accrued liabilities | (305) | (4,698) |
Level 2 | Money market funds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | 0 |
Level 2 | Certificates of deposit | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 41,050 | 10,078 |
Level 2 | Commercial paper | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 310,774 | 225,067 |
Level 2 | Variable rate demand notes | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 6,266 | |
Level 2 | Municipal securities | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 129,574 | 213,798 |
Level 2 | Corporate bonds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 74,180 | |
Level 2 | U.S. government agency securities | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 151,678 | 113,357 |
Level 2 | U.S. treasuries | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 789,790 | 908,379 |
Level 3 | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Cash | 0 | 0 |
Foreign currency derivatives | 0 | 0 |
Assets measured at fair value | 0 | 0 |
Cash and cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Accounts receivable, net | 0 | 0 |
Investments | 0 | 0 |
Accrued liabilities | 0 | 0 |
Level 3 | Money market funds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | 0 |
Level 3 | Certificates of deposit | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | 0 |
Level 3 | Commercial paper | ||
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 |
Level 3 | Corporate bonds | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | |
Level 3 | U.S. government agency securities | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | 0 | 0 |
Level 3 | U.S. treasuries | ||
FAIR VALUE OF CERTAIN FINANCIAL ASSETS AND LIABILITIES | ||
Assets measured at fair value | $ 0 | $ 0 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Notional amount and fair value (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Foreign currency exchange contracts | Maximum | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Term of derivative instrument | 1 month | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive CAD Pay USD | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | $ 44,220 | $ 34,467 |
Fair value assets | 168 | 106 |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive USD/pay CLP | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 56,610 | |
Fair value assets | 159 | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive USD/pay COP | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 15,493 | 11,570 |
Fair value assets | 37 | 12 |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive RSD/pay USD | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 4,560 | 3,513 |
Fair value assets | 18 | 112 |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive USD/pay GBP | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 43,551 | |
Fair value assets | 118 | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive SGD/pay USD | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 15,883 | |
Fair value assets | 398 | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive USD/pay MXN | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 12,430 | |
Fair value assets | 88 | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive GBP/pay USD 1 | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 34,716 | |
Fair value assets | 100 | |
Derivatives not designated as hedging instruments | Accounts receivables, net | Receive GBP/pay USD 2 | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount assets | 4,321 | |
Fair value assets | 31 | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay CLP | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 43,071 | |
Fair value liabilities | (2,549) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay EUR | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 18,642 | |
Fair value liabilities | (31) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay ZAR | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 4,117 | 3,124 |
Fair value liabilities | (97) | (1) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay NZD | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 6,906 | 4,093 |
Fair value liabilities | (32) | (91) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay CNY | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 12,460 | |
Fair value liabilities | (362) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay GBP | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 14,292 | |
Fair value liabilities | (24) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive SGD/pay USD | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 24,977 | |
Fair value liabilities | (10) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive AUD/pay USD | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 2,884 | |
Fair value liabilities | (6) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay EUR 1 | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 48,377 | 40,592 |
Fair value liabilities | $ (105) | (1,377) |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay EUR 2 | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 34,714 | |
Fair value liabilities | (295) | |
Derivatives not designated as hedging instruments | Accrued liabilities | Receive USD/pay AUD | ||
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Notional amount liabilities | 1,271 | |
Fair value liabilities | $ (23) |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Non hedging designation (Details) - Derivatives not designated as hedging instruments - Foreign currency exchange contracts - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | ||
Amount of loss recognized in income on derivatives | $ 7,852 | $ 4,019 |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
INVENTORIES | ||
Raw materials | $ 421,914 | $ 467,392 |
Work in process | 1,615 | 1,688 |
Finished goods | 483,194 | 466,551 |
Inventories | $ 906,723 | $ 935,631 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | $ 792,622 | $ 750,055 | |
Less: accumulated depreciation and amortization | (246,700) | (233,158) | |
Property and equipment, net | 545,922 | 516,897 | |
Total depreciation and amortization expense | 14,800 | $ 13,100 | |
Land | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 139,922 | 139,798 | |
Leasehold improvements | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 31,753 | 31,327 | |
Furniture and fixtures | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 9,335 | 9,286 | |
Office and computer equipment | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 22,532 | 22,386 | |
Computer software | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 5,310 | 5,906 | |
Equipment | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 255,991 | 244,739 | |
Buildings | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 164,821 | 163,885 | |
Vehicles | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | 51,675 | 49,175 | |
Assets under construction | |||
PROPERTY AND EQUIPMENT, NET | |||
Property and equipment, gross | $ 111,283 | $ 83,553 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | ||
Goodwill, beginning balance | $ 1,417,941 | $ 1,331,643 |
Acquisitions | 0 | 80,285 |
Goodwill, ending balance | 1,417,941 | 1,411,928 |
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 | 80,285 |
Goodwill, ending balance | 86,298 | 80,285 |
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 | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |||
Amortizing intangibles | $ 121,378 | $ 121,378 | |
Accumulated amortization | (70,800) | (68,790) | |
Amortizing intangibles, net | 50,578 | 52,588 | |
Non-amortizing intangibles | 1,172,020 | 1,167,822 | |
Intangibles, net | 1,222,598 | $ 1,220,410 | |
Amortization expense | $ 2,000 | $ 1,500 | |
Minimum | |||
GOODWILL AND OTHER INTANGIBLE ASSETS | |||
Useful life of intangible assets | 5 years | ||
Maximum | |||
GOODWILL AND OTHER INTANGIBLE ASSETS | |||
Useful life of intangible assets | 15 years |
GOODWILL AND OTHER INTANGIBLE_5
GOODWILL AND OTHER INTANGIBLE ASSETS - Amortization expense (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Future estimated amortization expense related to amortizing intangibles | ||
2023 (from April 1, 2023 to December 31, 2023) | $ 2,736 | |
2024 | 3,648 | |
2025 | 3,647 | |
2026 | 3,647 | |
2027 | 3,646 | |
2028 and thereafter | 33,254 | |
Amortizing intangibles, net | $ 50,578 | $ 52,588 |
DISTRIBUTION AGREEMENTS (Detail
DISTRIBUTION AGREEMENTS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
DISTRIBUTION AGREEMENTS | ||
Distribution agreement (in years) | 20 years | |
Revenue recognized | $ 9.9 | $ 10 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Purchase Commitments (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
COMMITMENTS AND CONTINGENCIES | |
Aggregate contractual obligations | $ 380.6 |
Line of credit | |
COMMITMENTS AND CONTINGENCIES | |
Amount outstanding | $ 1.1 |
Interest rate (as a percent) | 5.50% |
Maximum borrowing capacity | $ 15 |
Raw material items | |
COMMITMENTS AND CONTINGENCIES | |
Purchase commitments | $ 336.8 |
Obligation term ( in years) | 1 year |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Litigation (Details) - USD ($) $ in Millions | 1 Months Ended | ||||
Feb. 14, 2023 | Sep. 29, 2022 | Apr. 30, 2022 | Mar. 31, 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 | $ 3.6 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Components of accumulated other comprehensive loss: | |||
Balance at the beginning of the period | $ (159,073) | [1] | $ 69,165 |
Other comprehensive income before reclassifications | 11,162 | (2,980) | |
Net current-period other comprehensive income | 11,162 | (2,980) | |
Balance at the end of the period | (147,911) | [1] | 72,145 |
Currency Translation Losses | |||
Components of accumulated other comprehensive loss: | |||
Balance at the beginning of the period | (153,230) | (68,209) | |
Other comprehensive income before reclassifications | 7,981 | 1,079 | |
Net current-period other comprehensive income | 7,981 | 1,079 | |
Balance at the end of the period | (145,249) | (67,130) | |
Unrealized 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 | 3,181 | (4,059) | |
Net current-period other comprehensive income | 3,181 | (4,059) | |
Balance at the end of the period | $ (2,662) | $ (5,015) | |
[1] 1 Stock Split - On February 28, 2023, the Company announced a two-for-one stock split of its common stock to be effected in the form of a 100% stock dividend. The stock dividend was issued on March 27, 2023 (the “Stock Split”). The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information. |
TREASURY STOCK (Details)
TREASURY STOCK (Details) - USD ($) $ in Thousands | 3 Months Ended | |||||
May 05, 2023 | Mar. 10, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | Nov. 02, 2022 | Jun. 14, 2022 | |
Treasury Stock Purchase | ||||||
Repurchase price of stock | $ 682,800 | |||||
Amount of shares purchased | $ 90,378 | $ 12,187 | ||||
Number of shares repurchased of common stock from employees in lieu of cash or withholding taxes due | 1,700,000 | |||||
Common stock [Member] | ||||||
Treasury Stock Purchase | ||||||
Cash payment for repurchase of common stock from employees in lieu of cash or withholding taxes due | $ 90,400 | |||||
March 2020 Repurchase Plan | ||||||
Treasury Stock Purchase | ||||||
Repurchase price of stock | $ 4,690,000 | |||||
March 2020 Repurchase Plan | Maximum | ||||||
Treasury Stock Purchase | ||||||
Common stock repurchased (in shares) | 170,000,000 | |||||
June 2022 Repurchase Plan | ||||||
Treasury Stock Purchase | ||||||
Repurchase price of stock | 182,800 | |||||
June 2022 Repurchase Plan | Maximum | ||||||
Treasury Stock Purchase | ||||||
Share repurchase program, authorized amount | $ 500,000 | |||||
November 2022 Repurchase Plan | ||||||
Treasury Stock Purchase | ||||||
Share repurchase program, authorized amount | $ 500,000 | |||||
Repurchase price of stock | $ 500,000 | |||||
November 2022 Repurchase Plan | Common stock [Member] | ||||||
Treasury Stock Purchase | ||||||
Common stock repurchased (in shares) | 0 |
STOCK-BASED COMPENSATION - Plan
STOCK-BASED COMPENSATION - Plans (Details) shares in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 USD ($) plan shares | Mar. 31, 2022 USD ($) | |
STOCK-BASED COMPENSATION | ||
Stock-based compensation plans | plan | 2 | |
Compensation expense on share-based plans | $ 16.1 | $ 16.3 |
Excess tax benefit realized for tax deductions from non-qualified stock option exercises and disqualifying dispositions of incentive stock options | $ 25.9 | $ 0.4 |
Granted 01/01/23 - 03/31/23 | ||
STOCK-BASED COMPENSATION | ||
Common stock granted, net of cancellations (in shares) | shares | 3,962 |
STOCK-BASED COMPENSATION - Fair
STOCK-BASED COMPENSATION - Fair Value Assumptions (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Stock options, Number of Shares | |||
Balance at the beginning of the period (in shares) | 29,710 | ||
Exercised (in shares) | (3,129) | ||
Cancelled or forfeited (in shares) | (73) | ||
Balance at the end of the period (in shares) | 30,470 | 29,710 | |
Vested and expected to vest in the future at the end of the period (in shares) | 29,381 | ||
Exercisable at the end of the period (in shares) | 19,309 | ||
Stock options, Weighted-Average Exercise Price Per Share | |||
Balance at the beginning of the period (in dollars per share) | $ 26.38 | ||
Exercised (in dollars per share) | 11.62 | ||
Cancelled or forfeited (in dollars per share) | 37.39 | ||
Balance at the end of the period (in dollars per share) | 31.04 | $ 26.38 | |
Vested and expected to vest in the future at the end of the period (in dollars per share) | 30.58 | ||
Exercisable at the end of the period (in dollars per share) | $ 24.79 | ||
Weighted-Average Remaining Contractual Term (in years) | |||
Weighted-Average Remaining Contractual Terms (in years) | 5 years 9 months 18 days | 5 years | |
Vested and expected to vest in the future at the end of the period | 5 years 7 months 6 days | ||
Exercisable at the end of the period | 4 years | ||
Aggregate Intrinsic Value | |||
Balance at the beginning of the period | $ 724,651 | ||
Balance at the end of the period | 699,802 | $ 724,651 | |
Vested and expected to vest in the future at the end of the period | 688,532 | ||
Exercisable at the end of the period | $ 564,190 | ||
Granted 01/01/23 - 03/31/23 | |||
Stock options, Weighted-Average Exercise Price Per Share | |||
Granted (in dollars per share) | $ 50.82 | ||
Employee Stock Option [Member] | |||
Weighted-average assumptions used to estimate the fair value of options granted | |||
Dividend yield (as a percent) | 0% | 0% | |
Expected volatility (as a percent) | 27.60% | 27.70% | |
Risk-free interest rate (as a percent) | 3.70% | 2.10% | |
Expected term | 6 years 3 months 18 days | 6 years |
STOCK-BASED COMPENSATION - Equi
STOCK-BASED COMPENSATION - Equity Awards (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
STOCK-BASED COMPENSATION | ||
Stock units expected to vest (in shares) | 29,381 | |
Total employee and non-employee share-based compensation expense included in income, before income tax | $ 16,051 | $ 16,332 |
Employee Stock Option [Member] | ||
STOCK-BASED COMPENSATION | ||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 18.23 | $ 11.61 |
Total intrinsic value of options exercised | $ 131,000 | $ 4,900 |
Cash received from option exercises | 36,300 | $ 4,500 |
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 125,200 | |
Cost expected to be recognized over a weighted-average period | 3 years 7 months 6 days | |
Restricted Stock Units [Member] | ||
STOCK-BASED COMPENSATION | ||
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 50.83 | $ 36.73 |
Restricted Stock Units And Performance Share Units [Member] | ||
STOCK-BASED COMPENSATION | ||
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 53,600 | |
Cost expected to be recognized over a weighted-average period | 1 year 10 months 24 days | |
Stock units expected to vest (in shares) | 1,800 | |
Number of Shares | ||
Non-vested at the beginning of the period (in shares) | 2,026 | |
Vested (in shares) | (576) | |
Forfeited/cancelled (in shares) | (4) | |
Non-vested at the end of the period (in shares) | 1,969 | |
Weighted Average Grant-Date Fair Value | ||
Non-vested at the beginning of the period (in dollars per share) | $ 36.27 | |
Vested (in dollars per share) | 32.87 | |
Forfeited/cancelled (in dollars per share) | 32.80 | |
Non-vested at the end of the period (in dollars per share) | $ 40.52 | |
Restricted Stock Units And Performance Share Units [Member] | Granted 01/01/23 - 03/31/23 | ||
Number of Shares | ||
Granted (in shares) | 523 | |
Weighted Average Grant-Date Fair Value | ||
Granted (in dollars per share) | $ 48.49 | |
Performance Share Units [Member] | ||
STOCK-BASED COMPENSATION | ||
Percentage of target performance | 100% | |
Performance Share Units [Member] | Maximum [Member] | ||
STOCK-BASED COMPENSATION | ||
Percentage of target performance | 200% | |
Performance Share Units [Member] | Minimum [Member] | ||
STOCK-BASED COMPENSATION | ||
Percentage of target performance | 0% | |
Other Share-based Awards [Member] | ||
STOCK-BASED COMPENSATION | ||
Total unrecognized compensation expense related to non-vested shares granted to employees | $ 300 | |
Cost expected to be recognized over a weighted-average period | 1 year 4 months 24 days |
INCOME TAXES - Unrecognized Tax
INCOME TAXES - Unrecognized Tax Benefit Rollforward (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 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 | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Weighted-average shares outstanding: | |||
Basic | [1] | 1,044,909 | 1,058,810 |
Dilutive securities | 14,160 | 12,298 | |
Diluted | [1] | 1,059,069 | 1,071,108 |
Totaling options and awards outstanding (in shares) | 2,600 | 3,200 | |
[1] Stock Split - The accompanying condensed consolidated financial statements and notes thereto have been retroactively updated to reflect the Stock Split. See Note 1 for additional information. |
SEGMENT INFORMATION - Net Reven
SEGMENT INFORMATION - Net Revenues (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 USD ($) segment | Mar. 31, 2022 USD ($) | |
SEGMENT INFORMATION | ||
Number of reportable segments | segment | 4 | |
Number of operating segments | segment | 4 | |
Net Sales | $ 1,698,930 | $ 1,518,574 |
Operating Income: | 485,064 | 399,489 |
Income before tax | 497,560 | 392,189 |
Recognition of deferred revenue | 9,900 | 10,000 |
Corporate and Unallocated | ||
SEGMENT INFORMATION | ||
Net Sales | 0 | 0 |
Operating Income: | (120,350) | (108,443) |
Income before tax | (108,742) | (115,730) |
Monster Energy Drinks | ||
SEGMENT INFORMATION | ||
Net Sales | 1,561,668 | 1,404,847 |
Monster Energy Drinks | Operating segment | ||
SEGMENT INFORMATION | ||
Net Sales | 1,561,669 | 1,404,847 |
Operating Income: | 560,819 | 454,563 |
Income before tax | 561,674 | 455,134 |
Recognition of deferred revenue | 9,900 | 10,000 |
Strategic Brands | ||
SEGMENT INFORMATION | ||
Net Sales | 86,358 | 92,593 |
Strategic Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Net Sales | 86,357 | 92,593 |
Operating Income: | 51,771 | 57,195 |
Income before tax | 51,788 | 57,254 |
Alcohol Brands | ||
SEGMENT INFORMATION | ||
Net Sales | 46,290 | 15,207 |
Alcohol Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Net Sales | 46,290 | 15,207 |
Operating Income: | (6,883) | (4,953) |
Income before tax | (6,867) | (5,606) |
Other | ||
SEGMENT INFORMATION | ||
Net Sales | 4,614 | 5,927 |
Other | Operating segment | ||
SEGMENT INFORMATION | ||
Net Sales | 4,614 | 5,927 |
Operating Income: | (293) | 1,127 |
Income before tax | $ (293) | $ 1,137 |
SEGMENT INFORMATION - Depreciat
SEGMENT INFORMATION - Depreciation and Amortization (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
SEGMENT INFORMATION | ||
Depreciation and amortization | $ 16,808 | $ 14,599 |
Corporate and Unallocated | ||
SEGMENT INFORMATION | ||
Depreciation and amortization | 2,424 | 2,814 |
Monster Energy Drinks | Operating segment | ||
SEGMENT INFORMATION | ||
Depreciation and amortization | 8,989 | 8,159 |
Strategic Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Depreciation and amortization | 221 | 233 |
Alcohol Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Depreciation and amortization | 4,051 | 2,283 |
Other | Operating segment | ||
SEGMENT INFORMATION | ||
Depreciation and amortization | $ 1,123 | $ 1,110 |
SEGMENT INFORMATION - Expenses
SEGMENT INFORMATION - Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
SEGMENT INFORMATION | ||
Stock-based compensation expense | $ 16.1 | $ 16.3 |
Corporate and Unallocated | ||
SEGMENT INFORMATION | ||
Payroll costs | 80.3 | 68.1 |
Stock-based compensation expense | 15.7 | 16.2 |
Professional service expenses | 22.1 | 26.4 |
Other operating expenses | $ 18 | $ 13.9 |
SEGMENT INFORMATION - Concentra
SEGMENT INFORMATION - Concentration Risk (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
SEGMENT INFORMATION | ||
Net Sales | $ 1,698,930 | $ 1,518,574 |
Sales | Outside United States | ||
SEGMENT INFORMATION | ||
Net Sales | $ 622,900 | $ 553,400 |
Sales | Customer concentration | Outside United States | ||
SEGMENT INFORMATION | ||
Percentage of net sales | 37% | 36% |
Coca-Cola Europacific Partners | Sales | Customer concentration | ||
SEGMENT INFORMATION | ||
Percentage of net sales | 13% | 12% |
Coca-Cola Consolidated, Inc | Sales | Customer concentration | ||
SEGMENT INFORMATION | ||
Percentage of net sales | 10% | 9% |
Reyes Coca-Cola Bottling, LLC | Sales | Customer concentration | ||
SEGMENT INFORMATION | ||
Percentage of net sales | 9% | 10% |
SEGMENT INFORMATION - Goodwill
SEGMENT INFORMATION - Goodwill and other intangible assets (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | $ 2,640,539 | $ 2,638,351 |
Monster Energy Drinks | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | 1,427,947 | 1,424,212 |
Strategic Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | 980,360 | 979,896 |
Alcohol Brands | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | $ 232,232 | 233,140 |
Other | Operating segment | ||
SEGMENT INFORMATION | ||
Goodwill and other intangible assets | $ 1,103 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) director | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Coca Cola Company | |||
RELATED PARTY TRANSACTIONS | |||
Net sales | $ 35,100 | $ 31,800 | |
Purchases from related party | $ 6,500 | 8,500 | |
Coca Cola Company | Voting Interests | |||
RELATED PARTY TRANSACTIONS | |||
Related Party Ownership Interest (as a percent) | 19.50% | ||
TCCC Subsidiaries and TCCC Related parties | |||
RELATED PARTY TRANSACTIONS | |||
Commission expenses | $ 15,700 | 18,400 | |
TCCC Subsidiaries and TCCC Related parties | Monster Energy Drinks | |||
RELATED PARTY TRANSACTIONS | |||
Contract manufacturing expenses | 7,400 | 9,200 | |
TCCC Related Parties and TCCC Independent Bottlers | Operating expense | |||
RELATED PARTY TRANSACTIONS | |||
Commission expenses | 8,800 | 11,000 | |
TCCC Subsidiaries | |||
RELATED PARTY TRANSACTIONS | |||
Accounts receivable, net | 128,697 | $ 88,169 | |
Accounts payable | (36,703) | (35,467) | |
Accrued promotional allowances | (10,833) | (11,222) | |
Accrued liabilities | $ (23,569) | $ (14,733) | |
Principal Owners | |||
RELATED PARTY TRANSACTIONS | |||
Number of directors | director | 1 | ||
Expenses incurred in connection with materials or services provided by a related party | $ 1,100 | 1,100 | |
Business Travelling Expenses | $ 0 | $ 80 |