Reaffirms 2023 Full-Year Financial Guidance
Provides Additional Detail on Strong Second
Quarter 2023 Expected Financial Results
Black Rifle Coffee (NYSE: BRCC) (“BRCC” or the “Company”), a
rapidly growing and mission-driven premium coffee company founded
to support veterans, active-duty military, and first responders and
serve a broad customer base by connecting consumers with great
coffee and a unique brand experience, today announced changes to
its management team to strengthen its ability to drive profitable
growth and serve customers. The Company is also reaffirming 2023
full-year financial guidance previously provided on May 11,
2023.
As of today, Chief Marketing Officer, Chris Mondzelewski, has
assumed the newly established role of president of Black Rifle
Coffee. In this role, Mr. Mondzelewski will take on the
responsibility of overseeing BRCC’s day-to-day operations,
alongside his current duties as chief marketing officer. Mr.
Mondzelewski joined BRCC in May following a nearly 12-year tenure
at Mars, where he most recently led growth initiatives for the
Global Petcare business as chief growth officer. Additionally, Mr.
Mondzelewski will assume many of Chief Operating Officer Toby
Johnson’s responsibilities, as she is departing the Company to
pursue other opportunities after building the foundation for BRCC’s
entry into the FDM channel with bagged coffee and scaling the RTD
coffee business in convenience stores.
The Company also announced today that, effective August 13,
2023, Greg Iverson will step down from his role as chief financial
officer and return to the education sector. Mark Weinsten, an
experienced financial executive, will serve as the Company’s
interim CFO. Mr. Weinsten has been working closely with BRCC’s
management team on various operational and productivity initiatives
since February 2023 and his financial expertise, familiarity with
BRCC’s operations, and experience serving in interim roles,
including as CFO, position him to lead BRCC’s finance team during
this interim period. The Company is conducting a search for a
permanent CFO.
“I want to thank Greg and Toby for the positive impact they have
had on Black Rifle as we have transitioned from the private to
public markets. The continued evolution of our management team and
organizational structure will further leverage the strengths and
expertise of the exceptional leaders we have within the
organization, drive enhanced cohesion across our operations and
create better opportunity for future growth,” commented Founder and
Co-CEO Evan Hafer.
Co-CEO Tom Davin commented, “Chris joined BRCC earlier this year
and quickly made a positive impact on the Company. His appointment
as president is recognition that his deep business and strategic
expertise extends well beyond marketing, which is why we are
expanding his scope to leverage his business development and
operational capabilities. Our business continued to perform well in
Q2, and I look forward to working alongside Chris and Mark and the
rest of our Board and leadership team as we continue to capitalize
on our strong brand momentum to drive industry leading growth in
both revenue and profitability.”
Financial Outlook
BRC Inc. provides guidance based on current market conditions
and expectations for revenue, gross margin and Adjusted EBITDA,
which is a non-GAAP financial measure.
For the full-year fiscal 2023, the Company reaffirms:
- Net revenue of $400-$440 million
- Gross Margin Target of 36% - 37.5%
- $5M - $20M of Adjusted EBITDA
For the quarter ending June 30, 2023, the Company
expects:
- Net revenue of approximately $91 million
- Adjusted EBITDA approaching break-even
The guidance provided above constitutes forward-looking
statements and actual results may differ materially. Refer to the
“Forward-Looking Statements” safe harbor section below for
information on the factors that could cause our actual results to
differ materially from these forward-looking statements.
We are presenting expected net revenue and Adjusted EBITDA based
on preliminary unaudited information for the quarter ending June
30, 2023, and these expected results remain subject to revision.
The financial measures have been prepared by, and are the
responsibility of, management of the Company. The Company’s
independent registered public accounting firm has not audited,
reviewed, compiled or performed any procedures with respect to the
estimated net revenue and Adjusted EBITDA provided above.
Accordingly, as quarter-end closing and review processes are
completed, actual results could differ from these preliminary
estimated results.
We have not reconciled forward-looking Adjusted EBITDA to its
most directly comparable GAAP measure, net income (loss), because
we cannot predict with reasonable certainty the ultimate outcome of
certain components of such reconciliations, including
market-related assumptions that are not within our control, or
others that may arise, without unreasonable effort. For these
reasons, we are unable to assess the probable significance of the
unavailable information, which could materially impact the amount
of future net loss. See “Non-GAAP Financial Measures” for
additional important information regarding Adjusted EBITDA.
About Chris Mondzelewski
Chris Mondzelewski brings over 20 years of consumer marketing,
business, and leadership experience, most recently serving as the
chief growth officer of Mars’ Global Petcare business. Throughout
his almost 12-year tenure at Mars, he consistently grew his
responsibilities, holding multiple marketing and business
development leadership roles in which he led transformative growth
and operational improvement strategies across numerous brands.
Prior to joining Mars, he held marketing roles at Kraft Foods,
where he launched several successful campaigns, including the most
successful innovation & campaign in recent Kraft Cheese
history. Before his business career, Mondzelewski was a Marine for
five years, deploying in support of Operation Desert Freedom.
About Mark Weinsten
Mark Weinsten is a managing director with Berkeley Research
Group and a member of the Corporate Finance leadership team. Mr.
Weinsten specializes in serving in interim executive positions in
the consumer industry, including roles as chief executive officer
and chief financial officer, and has served in C-level and interim
C-level interim roles at over eight different companies over the
last ten years, including American Apparel, Z Gallerie, and
Manischewitz.
Before joining Berkeley Research Group, Weinsten was a senior
managing director with FTI Consulting where he led the firm’s
Private Capital initiative and was part of the leadership team for
the Consumer Products and Retail and the Business Improvement &
Growth practice. Weinsten earned a BS in managerial economics from
Carnegie Mellon University and an MBA from the Wharton School of
the University of Pennsylvania.
About Black Rifle Coffee Company
Black Rifle Coffee Company (BRCC) is a Veteran-founded coffee
company serving premium coffee to people who love America. Founded
in 2014 by Green Beret Evan Hafer, Black Rifle develops their
explosive roast profiles with the same mission focus they learned
while serving in the military. BRCC is committed to supporting
Veterans, active-duty military, first responders and the American
way of life.
To learn more about BRCC, visit www.blackriflecoffee.com, follow
BRCC on social media, or subscribe to Coffee or Die Magazine's
daily newsletter at https://coffeeordie.com/presscheck-signup.
Forward-Looking Statements
This press release contains forward-looking statements about BRC
Inc. and its industry that involve substantial risks and
uncertainties. All statements other than statements of historical
fact contained in this press release, including statement’s
regarding the Company’s intentions, beliefs or current expectations
concerning, among other things, the Company’s financial condition,
liquidity, prospects, growth, strategies, future market conditions,
developments in the capital and credit markets and expected future
financial performance, as well as any information concerning
possible or assumed future results of operations, are
forward-looking statements. In some cases, you can identify
forward-looking statements because they contain words such as
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“intends,” “may,” “might,” “plan,” “possible,” “potential,”
“predict,” “project,” “should,” “will,” “would” and similar
expressions, but the absence of these words does not mean that a
statement is not forward-looking. The events and circumstances
reflected in the Company’s forward-looking statements may not be
achieved or occur and actual results could differ materially from
those projected in the forward-looking statements. Factors that may
cause such forward-looking statements to differ from actual results
include, but are not limited to: competition and our ability to
grow and manage growth sustainably and retain our key employees;
failure to achieve profitability; negative publicity affecting our
brand and reputation, or the reputation of key employees, which may
adversely affect our operating results; failure by us to maintain
our message as a supportive member of the veteran and military
communities and any other factors which may negatively affect the
perception of our brand; our limited operating history, which may
make it difficult to successfully execute our strategic initiatives
and accurately evaluate future risks and challenges; failed
marketing campaigns, which may cause us to incur costs without
attracting new customers or realizing higher revenue; failure to
attract new customers or retain existing customers; risks related
to the use of social media platforms, including dependence on
third-party platforms; failure to provide high-quality customer
experience to retail partners and end users, including as a result
of production defaults, or issues, including due to failures by one
or more of our co-manufacturers, affecting the quality of our
products, which may adversely affect our brand; decrease in success
of the direct to consumer revenue channel; loss of one or more
co-manufacturers, or delays, quality, or other production issues,
including labor-related production issues at any of our
co-manufacturers; failure to effectively manage or distribute our
products through our wholesale business partners; failure by third
parties involved in the supply chain of coffee, store supplies or
merchandise to produce or deliver products, including as a result
of ongoing supply chain disruptions, or our failure to effectively
manage such third parties; changes in the market for high-quality
coffee beans and other commodities; fluctuations in costs and
availability of real estate, labor, raw materials, equipment,
transportation or shipping; loss of confidential data from
customers and employees, which may subject us to litigation,
liability or reputational damage; failure to successfully compete
with other producers and retailers of coffee; failure to
successfully open new Black Rifle Coffee Outposts, including
failure to timely proceed through permitting and other development
processes, or the failure of any new or existing Outposts to
generate sufficient sales; failure to properly manage our rapid
growth and relationships with various business partners; failure to
protect against software or hardware vulnerabilities; failure to
build brand recognition using our intellectual properties or
otherwise; shifts in consumer spending, lack of interest in new
products or changes in brand perception upon evolving consumer
preferences and tastes; failure to adequately maintain food safety
or quality and comply with food safety regulations; failure to
successfully integrate into new domestic and international markets;
risks related to leasing space subject to long-term non-cancelable
leases and with respect to real property; failure of our franchise
partners to successfully manage their franchises; failure to raise
additional capital to develop the business; risks related to supply
chain disruptions; risks related to unionization of employees;
failure to comply with federal state and local laws and
regulations; inability to maintain the listing of our Class A
Common Stock on the New York Stock Exchange; and other risks and
uncertainties indicated in our Annual Report on Form 10-K for the
year ended December 31, 2022 filed with the Securities and Exchange
Commission (the “SEC”) on March 15, 2023 including those set forth
under “Item 1A. Risk Factors” included therein, as well as in our
other filings with the SEC. Such forward-looking statements are
based on information available as of the date of this press release
and the Company’s current beliefs and expectations concerning
future developments and their effects on the Company. Because
forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted or quantified, you
should not place undue reliance on these forward-looking statements
as predications of future events. Although the Company believes
that it has a reasonable basis for each forward-looking statement
contained in this press release, the Company cannot guarantee that
the future results, growth, performance or events or circumstances
reflected in these forward-looking statements will be achieved or
occur at all. These forward-looking statements speak only as of the
date of this press release. The Company does not undertake any
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws.
Non-GAAP Financial Measures
To evaluate the performance of our business, we rely on both our
results of operations recorded in accordance with generally
accepted accounting principles in the United States ("GAAP") and
certain non-GAAP financial measures, including Adjusted EBITDA.
Adjusted EBITDA is not defined or calculated under principles,
standards or rules that comprise GAAP. Accordingly, Adjusted EBITDA
should not be viewed as a substitute for performance measures
derived in accordance with GAAP or as a substitute for a measure of
liquidity. Our definition of Adjusted EBITDA described below is
specific to our business and you should not assume that it is
comparable to similarly titled financial measures of other
companies. We define EBITDA as net income (loss) before interest,
state income taxes, depreciation and amortization expense. We
define Adjusted EBITDA as EBITDA excluding non-cash fair value
adjustments relating to the remeasurement of earn-out and
derivative liabilities upon vesting events and the remeasurement of
a warrant liability upon redemption of warrants, and as further
adjusted for equity-based compensation, system implementation
costs, transaction expenses, executive recruiting, severance,
relocation and sign-on bonus, write-off of site development costs,
strategic initiative related costs, non-routine legal expenses, RTD
start-up production issue, and contract termination costs. When
used in conjunction with GAAP financial measures, we believe that
Adjusted EBITDA is a useful supplemental measure of operating
performance because this measure facilitates comparisons of
historical performance by excluding non-cash items such as
equity-based payments and other amounts not directly attributable
to our primary operations, such as the impact of system
implementation, acquisitions, disposals, executive searches,
executive severance, non-routine investigations, litigation and
settlements. Adjusted EBITDA is also a key metric used internally
by our management to evaluate performance and develop internal
budgets and forecasts. Adjusted EBITDA has limitations as an
analytical tool and should not be considered in isolation or as a
substitute for analyzing our results as reported under GAAP and may
not provide a complete understanding of our operating results as a
whole. Some of these limitations are (i) Adjusted EBITDA does not
reflect changes in, or cash requirements for, our working capital
needs, (ii) Adjusted EBITDA does not reflect our interest expense
or the cash requirements necessary to service interest or principal
payments on our debt, (iii) Adjusted EBITDA does not reflect our
tax expense or the cash requirements to pay our taxes, (iv)
Adjusted EBITDA does not reflect historical capital expenditures or
future requirements for capital expenditures or contractual
commitments, (v) although equity-based compensation expenses are
non-cash charges, we rely on equity compensation to compensate and
incentivize employees, directors and certain consultants, and we
may continue to do so in the future and (vi) although depreciation,
amortization and impairments are non-cash charges, the assets being
depreciated and amortized will often have to be replaced in the
future, and Adjusted EBITDA does not reflect any cash requirements
for such replacements.
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version on businesswire.com: https://www.businesswire.com/news/home/20230629443951/en/
Investors Tanner Doss:
IR@BlackRifleCoffee.com ICR for BRCC: BlackrifleIR@icrinc.com
Media PR for BRCC:
press@blackriflecoffee.com
BRC (NYSE:BRCC)
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BRC (NYSE:BRCC)
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