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SEGMENT INFORMATION | 9 Months Ended
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Sep. 30, 2023
SEGMENT INFORMATION |
SEGMENT INFORMATION |
18. | SEGMENT INFORMATION
The Company has four operating and reportable segments: (i) Monster Energy® Drinks segment, which is primarily comprised of the Company’s Monster Energy® drinks, Reign StormTM total wellness energy drinks, Reign® Total Body Fuel high performance energy drinks, Bang Energy® drinks and Monster Tour Water® (ii) Strategic Brands segment, which is primarily comprised of the various energy drink brands acquired from TCCC in 2015 as well as the Company’s affordable energy brands, (iii) Alcohol Brands segment, which is primarily comprised of the various craft beers and hard seltzers purchased as part of the CANarchy Transaction on February 17, 2022 as well as The Beast UnleashedTM FMBs and (iv) Other segment, which is primarily comprised of the AFF Third-Party Products. The Company’s Monster Energy® Drinks segment primarily generates net operating revenues by selling ready-to-drink packaged drinks primarily to bottlers/distributors. In some cases, the Company sells ready-to-drink packaged drinks directly to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, drug stores, foodservice customers, value stores, e-commerce retailers and the military. The Company’s Strategic Brands segment primarily generates net operating revenues by selling “concentrates” and/or “beverage bases” to authorized bottling and canning operations. Such bottlers generally combine the concentrates and/or beverage bases with sweeteners, water and other ingredients to produce ready-to-drink packaged energy drinks. The ready-to-drink packaged energy drinks are then sold by such bottlers to other bottlers/distributors and to retail grocery and specialty chains, wholesalers, club stores, mass merchandisers, convenience and gas chains, foodservice customers, drug stores, value stores, e-commerce retailers and the military. To a lesser extent, the Strategic Brands segment generates net operating revenues by selling certain ready-to-drink packaged energy drinks to bottlers/distributors. Generally, the Monster Energy® Drinks segment generates higher per case net operating revenues, but lower per case gross profit margin percentages than the Strategic Brands segment. The Company’s Alcohol Brands segment primarily generates operating revenues by selling kegged and ready-to-drink canned beers, hard seltzers and FMBs primarily to beer distributors in the United States. Generally, the Alcohol Brands segment has lower gross profit margin percentages than the Monster Energy® Drinks segment. Corporate and unallocated amounts that do not relate to a reportable segment have been allocated to “Corporate & Unallocated.” No asset information, other than goodwill and other intangible assets, has been provided in the Company’s reportable segments, as management does not measure or allocate such assets on a segment basis. The net revenues derived from the Company’s reportable segments and other financial information related thereto for the three- and nine-months ended September 30, 2023 and 2022 were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three-Months Ended | ​ | Nine-Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2023 |  | 2022 |  | 2023 |  | 2022
Net sales: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Monster Energy® Drinks1 | ​ | $ | 1,708,242 | ​ | $ | 1,502,219 | ​ | $ | 4,956,797 | ​ | $ | 4,444,755
Strategic Brands | ​ |  | 98,763 | ​ |  | 88,802 | ​ |  | 284,810 | ​ |  | 260,536
Alcohol Brands2 | ​ | ​ | 42,326 | ​ | ​ | 26,818 | ​ | ​ | 149,692 | ​ | ​ | 74,472
Other | ​ |  | 6,697 | ​ |  | 6,447 | ​ |  | 18,620 | ​ |  | 18,356
Corporate and unallocated | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
​ | ​ | $ | 1,856,028 | ​ | $ | 1,624,286 | ​ | $ | 5,409,919 | ​ | $ | 4,798,119
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three-Months Ended | ​ | Nine-Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2023 |  | 2022 |  | 2023 |  | 2022
Operating Income: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Monster Energy® Drinks1 | ​ | $ | 603,670 | ​ | $ | 492,534 | ​ | $ | 1,762,410 | ​ | $ | 1,388,815
Strategic Brands | ​ |  | 52,730 | ​ |  | 47,282 | ​ |  | 159,639 | ​ |  | 145,977
Alcohol Brands2 | ​ | ​ | (11,734) | ​ | ​ | (10,262) | ​ | ​ | (25,193) | ​ | ​ | (19,873)
Other | ​ |  | 1,296 | ​ |  | 977 | ​ |  | 2,654 | ​ |  | 3,138
Corporate and unallocated | ​ |  | (135,435) | ​ |  | (112,601) | ​ |  | (380,114) | ​ |  | (327,688)
​ | ​ | $ | 510,527 | ​ | $ | 417,930 | ​ | $ | 1,519,396 | ​ | $ | 1,190,369
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three-Months Ended | ​ | Nine-Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2023 |  | 2022 |  | 2023 |  | 2022
Income before tax: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Monster Energy® Drinks1 | ​ | $ | 604,688 | ​ | $ | 493,486 | ​ | $ | 1,765,018 | ​ | $ | 1,391,026
Strategic Brands | ​ |  | 52,746 | ​ |  | 47,319 | ​ |  | 159,683 | ​ |  | 146,082
Alcohol Brands2 | ​ | ​ | (11,757) | ​ | ​ | (10,124) | ​ | ​ | (25,208) | ​ | ​ | (19,620)
Other | ​ |  | 1,315 | ​ |  | 977 | ​ |  | 2,679 | ​ |  | 3,139
Corporate and unallocated | ​ |  | (65,108) | ​ |  | (111,579) | ​ |  | (283,766) | ​ |  | (342,190)
​ | ​ | $ | 581,884 | ​ | $ | 420,079 | ​ | $ | 1,618,406 | ​ | $ | 1,178,437
​
(1) | Includes $10.0 million for both the three-months ended September 30, 2023 and 2022 related to the recognition of deferred revenue. Includes $30.0 million for both the nine-months ended September 30, 2023 and 2022 related to the recognition of deferred revenue.
(2) | For the nine-months ended September 30, 2022, effectively from February 17, 2022 to September 30, 2022.
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three-Months Ended | ​ | Nine-Months Ended
​ | ​ | September 30, | ​ | September 30,
​ |  | 2023 |  | 2022 |  | 2023 |  | 2022
Depreciation and amortization: | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Monster Energy® Drinks | ​ | $ | 10,023 | ​ | $ | 7,773 | ​ | $ | 27,830 | ​ | $ | 24,035
Strategic Brands | ​ |  | 199 | ​ |  | 234 | ​ |  | 616 | ​ |  | 709
Alcohol Brands | ​ | ​ | 3,816 | ​ | ​ | 3,713 | ​ | ​ | 11,973 | ​ | ​ | 9,679
Other | ​ |  | 50 | ​ |  | 1,121 | ​ |  | 1,224 | ​ |  | 3,345
Corporate and unallocated | ​ |  | 3,891 | ​ |  | 2,768 | ​ |  | 8,721 | ​ |  | 8,272
​ | ​ | $ | 17,979 | ​ | $ | 15,609 | ​ | $ | 50,364 | ​ | $ | 46,040
​ Corporate and unallocated expenses for the three-months ended September 30, 2023 include $82.7 million of payroll costs, of which $17.4 million was attributable to stock-based compensation expenses (see Note 15 “Stock-Based Compensation”), as well as $27.3 million attributable to professional service expenses, including accounting and legal costs, and $25.4 million of other operating expenses. Corporate and unallocated expenses for the three-months ended September 30, 2022 include $69.4 million of payroll costs, of which $16.2 million was attributable to stock-based compensation expenses (see Note 15 “Stock-Based Compensation”), as well as $26.0 million attributable to professional service expenses, including accounting and legal costs, and $17.2 million of other operating expenses. Corporate and unallocated expenses for the nine-months ended September 30, 2023 include $245.5 million of payroll costs, of which $51.1 million was attributable to stock-based compensation expenses (see Note 15 “Stock-Based Compensation”), as well as $74.7 million attributable to professional service expenses, including accounting and legal costs, and $59.9 million of other operating expenses. Corporate and unallocated expenses for the nine-months ended September 30, 2022 include $207.6 million of payroll costs, of which $48.5 million was attributable to stock-based compensation expenses (see Note 15 “Stock-Based Compensation”), as well as $69.3 million attributable to professional service expenses, including accounting and legal costs, and $50.8 million of other operating expenses. Coca-Cola Europacific Partners accounted for approximately 14% and 12% of the Company’s net sales for the three-months ended September 30, 2023 and 2022, respectively. Coca-Cola Europacific Partners accounted for approximately 13% of the Company’s net sales for both the nine-months ended September 30, 2023 and 2022. Coca-Cola Consolidated, Inc. accounted for approximately 10% and 11% of the Company’s net sales for the three-months ended September 30, 2023 and 2022, respectively. Coca-Cola Consolidated, Inc. accounted for approximately 10% of the Company’s net sales for both the nine-months ended September 30, 2023 and 2022. Reyes Holdings, LLC accounted for approximately 9% and 10% of the Company’s net sales for the three-months ended September 30, 2023 and 2022, respectively. Reyes Holdings, LLC accounted for approximately 9% and 10% of the Company’s net sales for the nine-months ended September 30, 2023 and 2022, respectively. Net sales to customers outside the United States amounted to $733.7 million and $610.6 million for the three-months ended September 30, 2023 and 2022, respectively. Such sales were approximately 40% and 38% of net sales for the three-months ended September 30, 2023 and 2022, respectively. Net sales to customers outside the United States amounted to $2.07 billion and $1.81 billion for the nine-months ended September 30, 2023 and 2022, respectively. Such sales were approximately 38% of net sales for both the nine-months ended September 30, 2023 and 2022. Goodwill and other intangible assets for the Company’s reportable segments as of September 30, 2023 and December 31, 2022 were as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | September 30, |  | December 31,
​ |  | 2023 |  | 2022
Goodwill and other intangible assets: | ​ | ​ | ​ | ​ | ​ | ​
Monster Energy® Drinks | ​ | $ | 1,667,462 | ​ | $ | 1,424,212
Strategic Brands | ​ |  | 982,311 | ​ |  | 979,896
Alcohol Brands | ​ | ​ | 227,615 | ​ | ​ | 233,140
Other | ​ |  | — | ​ |  | 1,103
​ | ​ | $ | 2,877,388 | ​ | $ | 2,638,351
​

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 22 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-22 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-15 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 31 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-31 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 42 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-42 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 40 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-40 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//280/tableOfContent Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 26 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-26 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 34 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-34 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 41 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-41 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 + Details
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