LOS ANGELES - Zevia PBC (NYSE: ZVIA), a producer of zero sugar and zero calorie beverages, announced on Thursday that it has regained compliance with the New York Stock Exchange's (NYSE) minimum stock price requirement. The company had received a notice of noncompliance on June 26, 2024, when its Class A common stock's average closing price fell below $1.00 over a consecutive 30 trading-day period.
As of September 30, 2024, Zevia's stock closed above the $1.00 threshold and maintained the average closing share price at or above $1.00 over the preceding 30 trading days, thus meeting the NYSE's continued listing standard set forth in Section 802.01C of the NYSE Listed Company Manual.
Zevia PBC, headquartered in Los Angeles, is known for its commitment to providing healthy beverage options. The company is a Certified B Corporation and focuses on plant-based ingredients, offering a variety of soft drinks that are non-GMO, gluten-free, kosher, vegan, and contain zero sodium. Their products are widely distributed across the United States and Canada, available in over 34,000 retail locations.
The recovery in Zevia's stock price, allowing it to meet the NYSE's listing criteria, is a significant step for the company, which aims to contribute to global health improvements by reducing sugar consumption. This announcement is based on a press release statement from Zevia PBC.
In other recent news, Zevia PBC has disclosed its financial results for the second quarter of 2024. Despite a decrease in net sales and an increase in net loss, which amounted to $7 million for the quarter, the company remains optimistic about its growth potential. Zevia has successfully removed 2,900 metric tons of sugar from consumers' diets and seen growth in retail sales, particularly in the food channel. Challenges have been faced in club distribution and competitive pressures, but Zevia is committed to expanding its user base and investing in product innovation and marketing.
The company has also initiated a direct-store delivery initiative and increased prices on soda multipacks. Aiming for improved margins, Zevia plans to save $12 million annually through productivity initiatives. Despite a decrease in gross margins due to inventory charges and increased investment in promotions, the company is hopeful about future growth. Zevia expects to reduce its losses in the coming quarters and is focused on regaining distribution in certain club regions. These are all recent developments that highlight the company's ongoing efforts and strategies.
InvestingPro Insights
Zevia's recent compliance with NYSE listing requirements comes amid a challenging financial landscape for the company. According to InvestingPro data, Zevia's market capitalization stands at $75.62 million, reflecting its status as a small-cap company in the beverage industry.
Despite regaining compliance, Zevia faces ongoing financial hurdles. An InvestingPro Tip indicates that the company is "quickly burning through cash," which could be a concern for investors considering the company's growth prospects. This cash burn rate is particularly noteworthy given that Zevia is not profitable over the last twelve months, as another InvestingPro Tip points out.
On a positive note, Zevia "holds more cash than debt on its balance sheet," which provides some financial flexibility as it navigates its current challenges. This healthy cash position aligns with the company's ability to meet short-term obligations, as "liquid assets exceed short term obligations," according to another InvestingPro Tip.
The stock's recent performance has been mixed. While Zevia has shown a "strong return over the last three months" with a 54.19% price total return, it has also experienced significant volatility. The stock has "taken a big hit over the last week" with an 11.11% decline, and its year-to-date return stands at -48.26%.
For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for Zevia, providing a deeper understanding of the company's financial health and market position.
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