Newage Inc (NBEV) 2021 Q3 法說會逐字稿

Good afternoon, and welcome to NewAge, Inc. Third Quarter 2021 Earnings Conference Call. (Operator Instructions) As a reminder, today's conference is being recorded. I would now like to turn the conference over to Lisa Mueller, NewAge Vice President, Investor Relations. Please go ahead.

下午好，歡迎參加 NewAge, Inc. 2021 年第三季財報電話會議。 （操作員指示）提醒一下，今天的會議正在錄音。現在，我想將會議交給 NewAge 投資者關係副總裁 Lisa Mueller。請繼續。

Thank you, operator, and thank you all for joining us today to discuss NewAge's third quarter 2021 financial results. I'm here today with Brent Willis, Chief Executive Officer of NewAge; and Kevin Manion, Chief Financial Officer. On today's call, Brent will provide an overview of the operations and progress against our strategic initiatives, and then Kevin will provide a summary of our financial performance before we open it up to analyst questions.

謝謝接線員，也謝謝大家今天加入我們討論 NewAge 2021 年第三季的財務表現。今天我和 NewAge 的執行長 Brent Willis 一起來到這裡；以及財務長 Kevin Manion。在今天的電話會議上，布倫特將概述我們的營運狀況和策略性舉措的進展情況，然後凱文將總結我們的財務業績，然後再回答分析師的問題。

I'd like to remind everyone that this conference call may contain forward-looking statements reflecting management's current expectations regarding future results of operations, economic performance, financial conditions and achievements of the company. Forward-looking statements, specifically those concerning future performance are subject to certain risks and uncertainties.

我想提醒大家，本次電話會議可能包含前瞻性陳述，反映管理階層對公司未來經營績效、經濟表現、財務狀況和成就的當前預期。前瞻性陳述，特別是有關未來表現的陳述，會受到某種風險和不確定性的影響。

Factors that could cause these results to differ materially are set forth in our annual report on Form 10-K and in our 10-Q filed with the SEC. Any forward-looking statements that we make on this call are based on our assumptions as of today, and we undertake no obligation to update these statements as a result of new information or future events.

可能導致這些結果出現重大差異的因素在我們向美國證券交易委員會提交的 10-K 表年度報告和 10-Q 表中有所列出。我們在本次電話會議上所做的任何前瞻性陳述均基於我們今天的假設，我們不承擔因新資訊或未來事件而更新這些陳述的義務。

During this call, we may present both GAAP and non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in today's earnings press release and 10-Q, which are available on our website at newage.com.

在本次電話會議中，我們可能會展示 GAAP 和非 GAAP 財務指標。今天的收益新聞稿和 10-Q 中包含了 GAAP 與非 GAAP 指標的對帳表，可在我們的網站 newage.com 上查閱。

I'd now like to turn the call over to Brent Willis, our Chief Executive Officer. Brent?

現在我想將電話轉給我們的執行長布倫特威利斯。布倫特？

Thank you, Lisa. And as an aside, I am so excited that you're part of the company and excited about the contributions you're going to be making for both the company and for our shareholders. So good afternoon, everybody, and thank you to everyone for joining the call today. On today's call, I'd like you to give you some insight into progress against our major strategic priorities, provide perspective on our overall performance in the quarter and highlight some of our major drivers of our results going forward. And then Kevin is going to take you through the quarterly financials.

謝謝你，麗莎。順便說一句，我很高興你成為公司的一員，也很高興你將為公司和股東做出貢獻。大家下午好，感謝大家今天的電話會議。在今天的電話會議上，我希望您能向我們介紹一下我們主要戰略重點的進展情況，對我們本季度的整體表現提供一些看法，並強調一下未來推動我們業績發展的一些主要驅動因素。然後凱文將帶您了解季度財務狀況。

First, let me start off with a review of the quarter. Revenue increased 59% year-over-year to $100 million. Gross margin improved 6 full points to 66.3%, and adjusted EBITDA also improved by almost 50% versus last year. And achieving these results in the context of everything going on in the world, while we are in the midst of acquisition and integration and all of its associated complexities is not easy. Not only that, because we are managing our business to deliver sustainable and consistently growing EBITDA over time, we have had to make some decisions that may impact our results in the short term, but which are essential to building our foundation and providing a springboard for growth. And in the third quarter, we made some of those decisions for the long term, especially in the upgrade and integration of our systems across all partner companies, making a number of cost reductions to improve SG&A as a percentage of net sales and further integration of our operations.

首先，讓我先回顧一下本季的情況。營收年增59%至1億美元。毛利率提高了整整 6 個百分點，達到 66.3%，調整後的 EBITDA 也比去年提高了近 50%。在當今世界發生的一切事情的背景下，當我們正處於收購、整合以及所有相關的複雜過程時，要取得這些成果並不容易。不僅如此，由於我們正在管理我們的業務以實現可持續的、持續成長的 EBITDA，我們必須做出一些可能在短期內影響我們業績的決定，但這些決定對於建立我們的基礎和提供成長的跳板至關重要。在第三季度，我們做出了一些長期決策，特別是在所有合作公司的系統升級和整合方面，進行了一系列成本削減以提高銷售、一般及行政開支在淨銷售額中的百分比，並進一步整合我們的業務。

We made these decisions for the long-term health of our company, but they did have a short-term impact in Q3. For example, the onetime system integration had a negative impact on revenue. Also in the third quarter, our China business was negatively impacted by the industry changes enacted by the PRC government and Japan continued to feel the effects of the government sanction from last year. On the flip side, we saw good growth in a number of geographies around the world as these markets began to get back to work following COVID shutdowns. We overcame many of the complexities in the quarter as evidenced by improvement in our key indicators. Our monthly autoship subscribers increased 15% versus the prior quarter, and average order size was 6% higher. And the reason we track these key metrics across all of our markets, really on a day-to-day basis is because they are the leading indicators of revenue in the coming months. And for the most part, these indicators are all improving and moving in the right direction.

我們做出這些決定是為了公司的長期健康，但它們確實對第三季產生了短期影響。例如，一次性系統整合對收入產生了負面影響。此外，在第三季度，我們的中國業務受到中國政府頒布的行業改革的負面影響，日本繼續受到去年政府制裁的影響。另一方面，隨著這些市場在新冠疫情封鎖結束後開始恢復運轉，我們看到全球許多地區都實現了良好的成長。我們在本季克服了許多複雜困難，關鍵指標的改善就是明證。我們的每月自動出貨訂閱者數量比上一季增加了 15%，平均訂單規模增加了 6%。我們之所以每天追蹤所有市場的這些關鍵指標，是因為它們是未來幾個月收入的領先指標。總體來看，這些指標都在改善並朝著正確的方向發展。

Now looking ahead, we believe the systems upgrade and most of the merger integration items that impacted the top line in the quarter are onetime in nature and largely behind us, but we still have a few open items to complete. We are, however, encouraged by improving top line growth trends in the fourth quarter. Underlying demand is strong, evidenced by the metrics of our brand partners, and we anticipate sequential organic growth in Q4 in the high-single digits. We remain focused on what we can control, delivering on our promise to all stakeholders to drive growth and to do so profitably. While our supply chain remains strong, and we've had no major out of stocks, our lead times and cost on many of our raw materials, production and shipping have all increased, like virtually every other CPG company in the world.

展望未來，我們認為系統升級和影響本季度營業額的大多數合併整合項目本質上都是一次性的並且基本上已經過去了，但我們仍有一些未完成的項目需要完成。然而，第四季營收成長趨勢的改善令我們感到鼓舞。從我們品牌合作夥伴的數據可以看出，潛在需求強勁，我們預計第四季的有機成長率將達到高個位數。我們將繼續專注於我們能夠控制的事情，履行對所有利害關係人的承諾，推動成長並實現盈利。儘管我們的供應鏈仍然強勁，而且沒有出現大規模缺貨情況，但與世界上幾乎所有其他 CPG 公司一樣，我們的許多原材料、生產和運輸的交貨時間和成本都有所增加。

Kudos to our operations team, however, who have managed through the complexities like champs. As a result, though, we have had to hold higher inventory than planned, and this has a cash cost to us. But our redundancies that we have built into our supply chain are proving to be robust. But when we look at 2022, these actions are going to be even more critical because we don't expect the global supply chain complexities to diminish.

然而，我們的營運團隊值得稱讚，他們像冠軍一樣克服了複雜問題。但結果是，我們不得不持有比計劃更高的庫存，而這給我們帶來了現金成本。但事實證明，我們在供應鏈中建構的冗餘是強大的。但當我們展望2022年時，這些行動將變得更加關鍵，因為我們預期全球供應鏈的複雜性不會降低。

We are also harmonizing our manufacturing and logistics footprint globally, which led to the closing of our Mainz, Germany, European warehousing and establishing more operations locally in both the Netherlands and Italy. This has reduced our cost and improved our ability to serve our customers on a more local and locally centric basis. All these actions together have helped us improve our gross margin a full 6 points versus last year. This is the end result of all of those actions and reduced SG&A as a percent of net sales that Kevin will discuss.

我們還在全球範圍內協調我們的製造和物流佈局，這導致我們關閉了位於德國美因茨的歐洲倉庫，並在荷蘭和義大利本地建立了更多業務。這降低了我們的成本，並提高了我們以在地化和本地中心為基礎為客戶提供服務的能力。所有這些舉措幫助我們將毛利率較去年同期提高了整整 6 個百分點。這是所有這些行動的最終結果，以及 Kevin 將要討論的銷售、一般和行政費用佔淨銷售額的百分比降低。

Now these priorities are component parts of methodically growing profitability and capitalizing on the underlying trends that will propel our business forward. These are mega-trends like consumers pursuit of health and wellness worldwide and the demand for healthy, clean products. Our R&D team has been relentless in developing a pipeline of healthy, functionally differentiated brands that are -- they're as efficacious as they are safe and many of which have important benefits that, frankly, approach the boundaries and historical turf of big pharma. For example, our scientists discovered that our Tahitian Noni juice inhibits the ability of spike proteins to bind to human cells, adding to the long list of health benefits guarded from this incredible super fruit. And we're excited to have recently launched our Lucim eyelash volumizer and natural lip plumper, also developed 100% in-house, tapping into the growth segments within the healthy appearance category. These products were just rolled out to our North American brand partners and the initial inventory sold out within hours.

現在，這些優先事項已成為系統性地提高獲利能力和利用推動我們業務向前發展的潛在趨勢的組成部分。這些都是大趨勢，例如全球消費者對健康的追求以及對健康、清潔產品的需求。我們的研發團隊一直堅持不懈地開發一系列健康、功能差異化的品牌，這些品牌既有效又安全，其中許多品牌具有重要優勢，坦白說，這些優勢接近大型製藥公司的界限和歷史領域。例如，我們的科學家發現，大溪地諾麗果汁可以抑制刺突蛋白與人體細胞結合的能力，這為這種神奇的超級水果的許多健康益處增添了新的內容。我們很高興最近推出了 Lucim 睫毛增稠劑和天然豐唇劑，這也是 100% 內部開發的，挖掘了健康外觀類別中的成長細分市場。這些產品剛剛向我們的北美品牌合作夥伴推出，初始庫存在幾小時內就銷售一空。

We think we're just getting started in our business model with our aggregated base of influencers. We continue to invest in technology enhancements, such that our brand partners can use social selling seamlessly and develop multiple revenue streams, and we are continually rolling out new tools and tech to help them expand their businesses. And speaking of the expansion, we just opened up the Southern cone of Africa and will be expanding in many of the surrounding markets beginning in the fourth quarter. We are running the business for the long-term to benefit all of our many different stakeholders, our investors, of course, but also our associates, our brand partners, customers, suppliers and the communities we serve worldwide. We are working towards the same goal, making this transformation to become the leading social selling and distribution company in the world.

我們認為，憑藉我們匯集的影響力人士基礎，我們的商業模式才剛起步。我們持續投資於技術改進，以便我們的品牌合作夥伴能夠無縫地使用社交銷售並開發多種收入來源，並且我們也不斷推出新的工具和技術來幫助他們拓展業務。說到擴張，我們剛剛開拓了非洲南錐體市場，並將從第四季開始向許多周邊市場擴張。我們長期經營企業是為了造福我們眾多不同的利害關係人，當然包括我們的投資者，也包括我們的員工、品牌合作夥伴、客戶、供應商和我們在全球服務的社區。我們正朝著同一個目標努力，實現轉型成為全球領先的社交銷售和分銷公司。

It's not built overnight, but we think we have a world-class team, recently bolstered by the additions of Jen Grafton as our new General Counsel; Lisa Mueller as our new Head of Investor Relations; and Karima McDaniel, who is promoted internally to become our Chief Marketing Officer. We also will be evolving our Board as we progress to the next level. I want to personally thank Tim Haas, who recently announced his retirement after 4 years of dedicated service to the company. Tim was a grave and values centric leader for our company, and he and I have personally known each other for over 20 years since he was my boss at the Coca-Cola Company. He's now 75, and we have had just about enough of each other. He will be sorely missed, however, both personally and professionally, but deserves all the credit in the world. He is a fantastic and tough board member as a leader and as a personal mentor, personally, Tim, thank you.

雖然這不是一朝一夕就能建成的，但我們認為我們擁有一支世界一流的團隊，最近又聘請了 Jen Grafton 擔任我們的新總法律顧問，進一步增強了我們的實力； Lisa Mueller 擔任我們新任投資者關係主管；以及內部晉升為首席行銷長的 Karima McDaniel。隨著我們邁向下一階段，我們也將不斷發展我們的董事會。我要親自感謝提姆·哈斯，他在為公司服務了四年後，最近宣布退休。提姆是我們公司一位嚴肅、以價值為中心的領導者，自從他在可口可樂公司擔任我的老闆以來，我們彼此認識已經 20 多年了。他現在75歲了，我們已經厭倦彼此了。然而，無論從個人生活或職業角度來說，他都會被深深懷念，但他值得世界上所有的讚譽。作為領導者和個人導師，他是一位出色且嚴厲的董事會成員，就我個人而言，蒂姆，謝謝你。

As we evolve our Board and as we strengthen our leadership team and team of dedicated and passion brand partners, we have a tremendous amount of confidence with an increasingly clear line of sight to achieving our financial objectives, increasingly strong commitment to making a difference to the planet with healthy products and increasing belief in our unencumbered opportunity to become the leading social selling and distribution company in the world.

隨著董事會的不斷發展，領導團隊和敬業、充滿熱情的品牌合作夥伴團隊的壯大，我們對實現財務目標的願景越來越清晰，對透過健康產品改變地球環境的承諾越來越堅定，我們越來越相信我們有無限的機會成為全球領先的社交銷售和分銷公司。

And with that, I'll now turn it over to Kevin to review our third quarter results in more detail. Kevin?

現在，我將把時間交給凱文 (Kevin) 來更詳細地回顧我們第三季的業績。凱文？

Thank you, Brent, and good afternoon from our global world headquarters in Denver, Colorado. I'll start by discussing our financial results for the third quarter, followed by comments on our balance sheet. Please note that all comparisons are year-over-year unless otherwise noted. We will also be discussing non-GAAP results and a reconciliation of non-GAAP financial measures is included in our earnings release and 10-Q.

謝謝你，布倫特，大家下午好，這是我們位於科羅拉多州丹佛的全球總部。我將首先討論我們第三季的財務業績，然後對我們的資產負債表發表評論。請注意，除非另有說明，所有比較均為同比比較。我們還將討論非 GAAP 結果，並且非 GAAP 財務指標的對帳包含在我們的收益報告和 10-Q 中。

On a consolidated basis, third quarter revenue was $100 million compared to $63 million, which is a 59% increase over last year. The increase was primarily due to the acquisitions of ARIIX and Aliven. Last year's revenue also included $2 million from the retail brand business, which we sold in Q3 of last year. Our acquisitions contributed significantly to our year-over-year growth, with revenues growing 54% in China, 24% in Japan and 16% in the U.S. and also providing entry into new markets, such as Italy and France.

從綜合來看，第三季營收為 1 億美元，而去年同期為 6,300 萬美元，比去年同期成長 59%。成長主要歸因於收購 ARIIX 和 Aliven。去年的收入還包括來自零售品牌業務的 200 萬美元，我們於去年第三季將其出售。我們的收購對我們年成長做出了重大貢獻，中國市場收入成長了 54%，日本市場成長了 24%，美國市場成長了 16%，同時也為我們進入義大利和法國等新市場提供了機會。

Gross profit increased from $37 million to $66 million, primarily due to the additions of ARIIX and Aliven and also margin enhancement activities. Overall, gross margin percentage increased from 59.8% to 66.3% due to the positive impact of higher sales mix from ARIIX and Aliven, which carry a higher gross margin than our legacy DSD segment. The increase was also partially offset by higher freight costs.

毛利從 3,700 萬美元增至 6,600 萬美元，主要由於增加了 ARIIX 和 Aliven，以及利潤率提升活動。總體而言，由於 ARIIX 和 Aliven 的銷售組合提高帶來的正面影響，毛利率從 59.8% 上升至 66.3%，其毛利率高於我們傳統的 DSD 部門。運費上漲也部分抵銷了這一增幅。

SG&A increased from $28 million to $39 million, primarily due to the addition of ARIIX and other companies that were added to our group at the end of November last year. Although this is an increase on an absolute dollar basis, SG&A as a percent of revenue decreased from 45% to 39% this quarter. Our long-term target for SG&A remains at 25% of net revenue. As Brent mentioned, we made excellent progress in the third quarter, making improvements to our cost structure. We reduced annual compensation cost by over $3 million, closed several offices and sold the American Fork, Utah manufacturing facility, both of those save an additional $2 million annually.

銷售、一般及行政開支從 2,800 萬美元增加到 3,900 萬美元，這主要是由於去年 11 月底 ARIIX 和其他公司加入我們集團。雖然以絕對美元計算有所增加，但銷售、一般及行政費用佔收入的百分比本季從 45% 下降至 39%。我們的銷售、一般及行政費用的長期目標仍為淨收入的 25%。正如布倫特所提到的，我們在第三季取得了顯著進展，改善了我們的成本結構。我們將年度薪酬成本削減了 300 多萬美元，關閉了多家辦事處，並出售了位於猶他州 American Fork 的製造工廠，這兩項舉措每年可額外節省 200 萬美元。

Adjusted EBITDA improved from a loss of $8.4 million in Q3 of 2020 to a loss of $4.4 million this quarter. Included in adjusted EBITDA are 2 non-cash items: a $9.8 million gain for the forgiveness of PPP loans and a $16.2 million impairment charge for the write-off of the non-compete agreement from our ARIIX combination. The net loss was $2.7 million or $0.02 per share, an improvement from a net loss of $14.1 million or $0.14 per share versus the third quarter last year.

調整後的 EBITDA 從 2020 年第三季的虧損 840 萬美元改善至本季的虧損 440 萬美元。調整後的 EBITDA 包括 2 個非現金項目：免除 PPP 貸款的收益 980 萬美元，以及註銷我們與 ARIIX 合併產生的競業禁止協議的減值費用 1,620 萬美元。淨虧損為 270 萬美元，即每股 0.02 美元，較去年第三季的淨虧損 1,410 萬美元或每股 0.14 美元有所改善。

Net income will continue to be significantly impacted by the change in fair value of the derivative liability and liability classified warrants, which was $19.5 million this quarter. As a reminder, these instruments were used in our acquisitions and current financing and an increase in our stock price has a negative impact on the change in fair value. And accordingly, net income, while a decrease in our stock price has the opposite effect.

淨收入將繼續受到衍生負債和負債分類認股權證公允價值變動的顯著影響，本季變動為 1,950 萬美元。提醒一下，這些工具用於我們的收購和當前融資，而我們股價的上漲對公允價值的變動產生了負面影響。因此，淨收入和股價下跌會產生相反的效果。

Turning to the balance sheet. We have $62 million of total cash and $18 million of debt. We responded to the current supply chain pressures by increasing finished good inventories, which enables us to continue to meet consumer demand. We maintain a strong balance sheet with low leverage, and we are well-positioned to take advantage of potential growth opportunities as well as invest in our current infrastructure.

轉向資產負債表。我們的總現金為 6,200 萬美元，債務為 1,800 萬美元。我們透過增加成品庫存來應對當前的供應鏈壓力，這使我們能夠繼續滿足消費者的需求。我們保持著強勁的資產負債表和低槓桿率，並且我們有能力利用潛在的成長機會以及投資於我們現有的基礎設施。

Looking ahead, we anticipate having more visibility as we move beyond the integration of our acquisitions and as COVID transitions from pandemic to endemic, we expect to be able to provide guidance for the year 2022 when we report fourth quarter earnings in March. In the meantime, as we are 6 weeks into the fourth quarter, our revenues are trending higher in the high-single digits compared to the third quarter.

展望未來，隨著我們完成收購整合以及 COVID 從大流行轉變為地方性流行，我們預計未來將擁有更大的可見性，我們預計能夠在 3 月份報告第四季度收益時為 2022 年提供指引。同時，進入第四季已經六週了，與第三季相比，我們的營收呈現高個位數成長趨勢。

Before turning the call to questions, I want to make mention of 2 grants of common stock that are coming up this quarter. The first is a tranche of 1.67 million shares, which was approved by shareholders in May. The second tranche is the 12-month payout owed to the ARIIX shareholders as part of the merger agreement, which is set at a target of 25 million shares. The actual number of shares to be granted will be dependent upon finalization of working capital adjustments. Both tranches are subject to a 6-month lockup provision.

在開始提問之前，我想先提一下本季即將進行的兩筆普通股贈與。第一批為167萬股，已於5月份獲得股東批准。第二筆款項是合併協議中應付給 ARIIX 股東的 12 個月股息，目標為 2,500 萬股。實際授予的股份數量將取決於最終的營運資本調整。兩筆款項均受 6 個月的鎖定期限制。

Looking ahead, we remain confident in our growth strategy, and we are incredibly optimistic about the future for NewAge. We are committed to improving shareholder communications and delivering a best practices investor relations program. And with that, I'd like to turn it over to the operator to open the line for questions from our analysts.

展望未來，我們對我們的成長策略仍然充滿信心，我們對 NewAge 的未來充滿信心。我們致力於改善股東溝通並提供最佳實踐的投資者關係計劃。現在，我想將電話轉給接線員，以便讓我們的分析師能夠提問。

Thank you. (Operator Instructions) Our first question is coming from the line of Mike Grondahl from Northland Securities.

謝謝。 （操作員指示）我們的第一個問題來自 Northland Securities 的 Mike Grondahl。

This is Luke on for Mike. Wondering if you guys could talk a little more on geographic performance during the quarter, and any assumptions going forward in any specific regions as far as continued disruptions or rebounds you expect? And then secondly, wondering if you guys have any updates on the M&A front. I think last quarter, you guys mentioned you're still kind of putting the roadmap together in this area. But just wondering if your appetite for M&A has grown or if you're more focused on kind of leveraging and building out the core platforms organically.

這是盧克 (Luke) 代替邁克 (Mike)。想知道你們是否能再談談本季的地理表現，以及您預計特定地區將持續出現中斷或反彈的任何假設？其次，想知道你們在併購方面是否有任何最新消息。我想上個季度你們曾提到，你們仍在製定這一領域的路線圖。但我只是想知道您對併購的興趣是否增長了，或者您是否更專注於利用和有機地建立核心平台。

Yes. Great question, Luke. Thank you. It's Brent here. On the geographic side, one of the scourges and benefits of being in 75 markets is sometimes some go up in certain regions of the world, sometimes some go down. As mentioned on the call, we have had the impact in China due to the government changes there. And we have had the impact in Japan. But as we work through those issues and we think we're working through both of those issues there and adjusting our business models and rolling out our social selling tools in China, and integrating our businesses, including our newest business there, Aliven in Japan, we see renewed growth in those markets. Europe continues to grow well for us and as does the Americas. So it is a combination of puts and takes, but we do see growth opportunities across all of our geographies.

是的。盧克，你問得好。謝謝。我是布倫特。從地理方面來看，涉足 75 個市場所帶來的好處和壞處就是，在世界的某些地區，有時某些市場會上升，有時則會下降。正如在電話會議中提到的，由於中國政府的變化，我們在中國受到了影響。而我們已經在日本產生了影響。但隨著我們解決這些問題，我們認為我們正在解決這兩個問題，並調整我們的商業模式，在中國推出我們的社交銷售工具，整合我們的業務，包括我們在那裡最新的業務，日本的 Aliven，我們看到這些市場出現了新的成長。對我們來說，歐洲繼續保持良好的成長勢頭，美洲也是如此。因此，這是投入和產出的結合，但我們確實看到了所有地區的成長機會。

And to the second point of your question, whether organic or external growth, we still see a whole wealth of opportunities out there. And we've been cautious in pursuing those external growth opportunities because we wanted to get the foundation right, especially in our systems. So it's kind of 9 months since we've had ARIIX and Noni's, you know, MaVie, LIMU and Aliven together, right, which in acquisition and integration timing is a very short period of time. So we're still in acquisition and integration mode to deliver the cost and the revenue synergies from all of the benefits of those acquisitions, which we captured a lot of those incrementally, as Kevin mentioned, in terms of lower SG&A and compensation costs in the quarter. Those are all benefits of the merger. And we're well in excess, I would say, of the initial synergies that we committed to shareholders to achieve from that combination.

關於你問題的第二點，無論是內部成長還是外部成長，我們仍然看到大量的機會。我們一直謹慎地尋求這些外部成長機會，因為我們希望打好基礎，特別是在我們的系統方面。距離我們將 ARIIX、Noni、MaVie、LIMU 和 Aliven 整合在一起已經 9 個月了，從收購和整合的時間來看，這是一個非常短的時期。因此，我們仍處於收購和整合模式，以實現這些收購帶來的所有好處所帶來的成本和收入協同效應，正如 Kevin 所提到的，我們在本季度以較低的銷售、一般和行政費用以及薪酬成本的形式逐步獲得了其中的大部分收益。這些都是合併的好處。我想說，我們已經遠遠超出了我們向股東承諾的透過合併實現的初始綜效。

So we spent this year really on acquisition and integration. And I would say, as it relates to external growth for the right price, primarily using debt because we don't believe that we can use our equity at this price for acquisitions in any significant measure. We think that as those opportunities come around to add scale and reduce SG&A, that got to really deliver for us financially on those 2 fronts, we'll definitely look at them. But there is a whole host of opportunities out there of companies that would love to join us. But right now, our focus is continue to drive the integration, drive EBITDA margin, drive organic growth and as external growth opportunities come about where we can intelligently and methodically integrate and we'll definitely look at those.

因此，我們今年主要致力於收購和整合。我想說，由於它與合適價格的外部成長有關，主要使用債務，因為我們不相信我們可以以這個價格以任何重大的方式使用我們的股權進行收購。我們認為，隨著這些機會的出現，我們可以擴大規模並降低銷售、一般及行政費用，從而真正在這兩個方面為我們的財務帶來好處，我們一定會考慮它們。但有許多公司願意加入我們，為他們提供大量的機會。但現在，我們的重點是繼續推動整合、推動 EBITDA 利潤率、推動有機成長，並且隨著外部成長機會的出現，我們可以智慧、有條不紊地進行整合，我們一定會關注這些。

Got it. And then just kind of a quick follow-up here on the acquisition and integration front. As far as ARIIX, anything to call out there? Is that still outperforming your guys' expectations? And is that -- you guys still planning on growth from that segment?

知道了。然後只是對收購和整合方面的一個快速跟進。就 ARIIX 而言，有什麼需要注意的嗎？這是否仍然超出了你們的預期？你們是否仍計劃在該領域實現成長？

Yes. I would say, look, we communicated that we would deliver at least $20 million in cost synergies. And I would say that we're at least 30% ahead of target. Now it doesn't -- and we committed that, that would happen in accrue to the P&L over a 12- to 18-month period of time. So 9 months in, we have visibility to at least 30% improvement on that number, and we expect that to fully materialize, probably closer to the 12-month timeframe from an acquisition standpoint versus 18 months. So a little bit faster than anticipated and about 30% greater than anticipated.

是的。我想說，看，我們已經傳達過，我們將實現至少 2000 萬美元的成本協同效應。我想說我們至少提前完成了目標 30%。現在還沒有——我們承諾，這將在 12 到 18 個月的時間內計入損益表。因此，9 個月後，我們可以看到該數字至少有 30% 的改善，並且我們預計這一數字將完全實現，從收購的角度來看，可能更接近 12 個月的時間範圍，而不是 18 個月。因此比預期的要快一點，比預期的高出約 30％。

Got it. I'll hop back in the queue.

知道了。我將重新回到隊列中。

Our next question today comes from the line of Sean McGowan from ROTH Capital Partners.

今天的下一個問題來自 ROTH Capital Partners 的 Sean McGowan。

Can you hear me okay?

你聽得到我說話嗎？

Hey, Sean.

嘿，肖恩。

Good. Can you quantify or help us understand the magnitude of the effect on revenue of that system switchover? Just how much did that cost you?

好的。您能量化或幫助我們了解系統轉換對收入的影響程度嗎？這花了你多少錢？

Yes. This is Kevin, Sean. So I think, look, that's a lot of art rather than science. So I would say it certainly was more than a couple million bucks and less than 15-ish. So it was an issue that happens a lot when you integrate 2 businesses and you have to reeducate all your brand partners and your sales teams. So the guys have done a great job of integrating and stabilizing, but it's been hard work, and it was certainly bumpy because we were going very fast across a lot of countries in a lot of geographies.

是的。這是凱文，肖恩。因此我認為，這更多的是藝術而不是科學。所以我會說這個數字肯定超過幾百萬美元但不超過一千五百萬美元。因此，當你整合兩家公司時，這個問題經常會發生，你必須重新培訓所有品牌合作夥伴和銷售團隊。所以，這些傢伙在整合和穩定方面做得很好，但這是艱苦的工作，而且肯定是坎坷的，因為我們在許多地區的許多國家發展得非常快。

Okay. And maybe you can help me understand something. So last year, in 2020, you didn't have the ARIIX until the fourth quarter. And your second and third quarters were about the same. You get to the second quarter of this year a very big contribution from ARIIX and it seems like maybe not as much in the third quarter. So can you help me with the kind of breakdown of organic versus acquired growth in the third quarter compared to last year?

好的。也許您可以幫助我理解一些事情。所以去年，也就是 2020 年，你直到第四季才擁有 ARIIX。你的第二季和第三季的表現也差不多。今年第二季度，ARIIX 的貢獻非常大，但第三季的貢獻似乎沒那麼大。那麼，您能否幫我分析一下與去年同期相比，第三季的有機成長與收購成長的差異？

There wasn't a lot of seasonality. So it's not really that, but it is a measure and a combination of this integration. I think when you look at the competitive set, they saw similar kinds of organic impacts in Q3 versus Q2, we saw the same as basically people were pent-up for 18 months, and some of our brand partners took vacation, especially in Europe, because it's the first time they were able to do it in 18 months. So I think they took the pedal off the metal a little bit there in that respect.

沒有太多的季節性。所以它其實不是那樣，而是一種衡量標準，也是這種整合的一種結合。我認為，當你觀察競爭對手時，你會發現他們在第三季度和第二季度看到了類似的有機影響，我們也看到了同樣的情況，因為基本上人們被壓抑了 18 個月，我們的一些品牌合作夥伴休假了，尤其是在歐洲，因為這是他們 18 個月來第一次能夠這樣做。因此我認為他們在這方面將踏板從金屬上移開了一點。

And then we had the challenges, as we mentioned, both with the Japan impact from the sanction from last year that wasn't in the numbers, the impact of the PRC government changes in terms of shipping models and bonded warehousing and other impacts there and the impact of the systems change, which really affected us worldwide. So all of those 3 things, we think, are onetime impacts, but they did impact on a sequential basis versus Q2. And I think the headline for us is, look, we still see this as an attractive growth business, organic growth business. And that's why Kevin mentioned, we see already for Q4, high single-digit growth moving into Q4. As we work through these integration challenges and build the right foundation to help our brand partners grow their business worldwide.

然後，正如我們所提到的，我們面臨的挑戰包括去年日本受到的製裁（數字上沒有體現）的影響、中國政府在航運模式和保稅倉儲等方面的變化以及系統變化的影響，這些確實對我們在全球範圍內產生了影響。因此，我們認為，這三件事都是一次性影響，但與第二季度相比，它們確實產生了連續影響。我認為我們的重點是，看，我們仍然認為這是一項具有吸引力的成長型業務，有機成長型業務。這就是凱文提到的原因，我們已經看到第四季將出現高個位數成長。我們努力克服這些整合挑戰並建立正確的基礎來幫助我們的品牌合作夥伴在全球範圍內發展業務。

Okay. And just to be clear, that's sequential as compared to the third quarter, that high-single digits growth?

好的。需要明確的是，與第三季相比，這是連續的，有高個位數的成長嗎？

Correct.

正確的。

Okay. And Kevin, would you expect, given a bunch of the expense commentary, would you expect adjusted EBITDA to be positive in the fourth quarter?

好的。凱文，考慮到大量的費用評論，您是否預計第四季度的調整後 EBITDA 將為正值？

I'm not going to give guidance, but the answer is certainly, we've made a lot of investments and eliminated some redundancies and positions and rationalized our real estate footprint. So certainly, SG&A costs will go down.

我不會給出指導，但答案肯定是，我們進行了大量投資，消除了一些冗餘和職位，並合理化了我們的房地產足跡。因此，銷售、一般及行政開支肯定會下降。

Okay. Down in dollars, you mean?

好的。你的意思是美元下跌？

Correct.

正確的。

(Operator Instructions) Next question is coming from the line of Aaron Grey from Alliance Global.

（操作員指示）下一個問題來自 Alliance Global 的 Aaron Grey。

Are you guys able to hear me?

你們聽得到我的聲音嗎？

Yes, we got you.

是的，我們抓到你了。

All right. I'll start right back over. So first question for me, supply chain issues that you spoke to, Brent, obviously, an issue that's impacting almost everybody within the industry today. But you kind of spoke to kind of having continuing impact for you guys. And just curious, you spoke about sometimes the systems consolidation, and I was wondering in terms of if the supply chain issues, how much of an impact that might have had? And if you expect that to continue, does that kind of impact maybe the pace of top line growth you guys can have going forward, especially as you try and integrate these 2 businesses and being in 75 countries? Just trying to get a better sense of high single-digit growth for the fourth quarter, how do we think about that going into 2022?

好的。我將立即重新開始。所以對我來說第一個問題是，布倫特，您談到的供應鏈問題，顯然這個問題當今影響著行業內的幾乎所有人。但您說過這會對你們產生持續的影響。我很好奇，您有時會談到系統整合，我想知道就供應鏈問題而言，這可能會產生多大的影響？如果您預計這種情況會持續下去，那麼這是否會對您們未來的營收成長速度產生影響，尤其是當您嘗試整合這兩家公司並業務遍布 75 個國家時？只是想更了解第四季的高個位數成長，我們如何看待 2022 年的成長？

It's a great question, Aaron. And I will tell you, the supply chain complexities are real. That being said, I can't overemphasize how proud I am of our entire operations and supply chain team and what just a superb job that they've done. And I don't think we've had any kind of negative impact on revenue or disruptions from a supply chain standpoint. We haven't had any out of stock. So that's point one. The second data point in terms of performance on a supply chain and operations standpoint is the improvement in gross margin of 6 points. That's the end result of shipping and cost of goods sold, management and margin improvement in portfolio and improvement in margin from value engineering of the portfolio. So the team has done a superb job on all 3 of those fronts, too.

這是一個很好的問題，亞倫。我會告訴你，供應鏈的複雜性是真實存在的。話雖如此，我不能過分強調我對我們整個營運和供應鏈團隊的自豪以及他們所做的出色工作。從供應鏈的角度來看，我認為我們沒有對收入產生任何負面影響或造成任何中斷。我們沒有缺貨的情況。這是第一點。從供應鏈和營運角度來看，第二個數據點是毛利率提高了 6 個百分點。這是運輸和銷售成本、投資組合管理和利潤率提高以及投資組合價值工程利潤率提高的最終結果。因此，該團隊在這三個方面也都做得非常出色。

And then lastly, everybody, I think, on the planet knows of the long-haul logistics and over-water logistics difficulties that are happening around the world, and the things that we've done to alleviate those of -- we're doing a lot of less shipment, let's say, from Tahiti into the United States, and rather we're doing shipments from to Tahiti direct to in-country markets, number one, a lot more in-country production number 2, and just avoiding having to ship out from the U.S. to the rest of the world. So because we've made those adjustments in our supply chain over the past, I would say, 6 or 9 months, it really puts us in a strong position to continue to manage the business unencumbered.

最後，我想，地球上的每個人都知道世界各地正在發生的長途物流和水上物流困難，以及我們為緩解這些困難所採取的措施——我們減少了從塔希提島到美國的運輸量，而是直接將產品從塔希提島運往國內市場，這是第一，第二，更多的是在國內進行生產，從而避免從美國運往世界其他地方。因此，由於我們在過去 6 到 9 個月內對供應鏈做出了調整，這確實使我們處於有利地位，可以繼續不受阻礙地管理業務。

Okay. And it's great to hear that supply chain issue wasn't a big impact on the top line during the quarter for you guys nor out of stock.

好的。很高興聽到供應鏈問題沒有對你們本季的營業額造成重大影響，也沒有出現缺貨的情況。

Yes, this quarter. honestly, it was systems, Aaron, as we integrated that, and that's a huge deal. It was China in terms of the rule changes. But I think we're really through that, and boy, China looks fantastic so far in Q4, and it was the Japan sanction recovery, and that is coming back around a bit slower but still coming around.

是的，本季。老實說，Aaron，當我們整合它時，它就是系統，這是一件大事。從規則變化來看，這是中國。但我認為我們真的已經度過了難關，中國在第四季度的表現非常好，而且這是日本製裁後的復甦，雖然速度有點慢，但仍在復蘇。

Okay. That's helpful. So then kind of look forward, I know you guys aren't giving guidance right now, but I just thinking about kind of maybe some sense of normalcy after COVID, you guys had implemented a lot of omnichannel initiatives mid-COVID, you know, people spend a lot more time then in the house. But as people get back out are going back on, taking the vacations, like you talk about some of your own employees now. How do you think about the business and maybe people spending more of their discretionary dollars on vacations or otherwise more out-of-home experiences and how that might impact the sales trends as we look ahead into 2022? Just trying to get a better sense of maybe those organic growth opportunities for your omnichannel initiative that you had.

好的。這很有幫助。那麼展望未來，我知道你們現在沒有給出指導，但我只是在想，也許在疫情過後會恢復正常，你們在疫情中期實施了很多全渠道舉措，你知道，人們花的時間比在家裡多得多。但隨著人們重返工作崗位，休假，就像您現在談論的一些自己的員工一樣。您如何看待這項業務？只是想更了解您的全通路計畫可能帶來的自然成長機會。

On the negative side, first, let me deal with that, right, just to be balanced in terms of the situation assessment, on the negative side, especially in Q3, you saw people getting out, right? You saw less brand partners joining this sector, this industry. And overall, I think there was about a 20% decline or 21% decline in brand partners or reps or distributors, whatever you want to call them, participating or joining in this industry. And so I think every competitor, at least in direct selling felt that effect. That's short-term though. Long-term, we see real trends towards direct-to-consumer purchases and direct-to-consumer shipping and away from traditional retail, and we don't think it's going to go back. We think traditional retail will continue to be dis-intermediated. That is really in our sweet spot and a fantastic tailwind for us.

首先，就消極方面而言，讓我來處理這個問題，對吧，只是為了在情況評估方面保持平衡，就消極方面而言，特別是在第三季度，你看到人們退出了，對吧？你會看到越來越少的品牌合作夥伴加入這個領域、這個產業。總體而言，我認為參與或加入該行業的品牌合作夥伴、代表或分銷商（無論你怎麼稱呼他們）的數量下降了約 20% 或 21%。因此我認為每個競爭對手，至少在直銷領域都感受到了影響。但這只是短期的。從長遠來看，我們看到直接面向消費者的購買和直接面向消費者的運輸的真正趨勢，遠離傳統零售，我們認為這種趨勢不會再回頭。我們認為傳統零售將繼續去中介化。這確實是我們的最佳狀態，對我們來說是極好的順風。

We see the real trends towards healthy products and the needs for consumers to intake more healthy products because they are recognizing that self-care is the new health care, and we're right on trend there. And then frankly, in terms of what is influencing purchase behavior and buying decisions is not TV advertising anymore, it's not print, and those kinds of things. It's not your point-of-sale marketing within traditional retail. It's word of mouth. And it's people social fees that are impacting more than 90% of purchase decisions in every single region of the world. And guess what, that is us, too. So from a business model standpoint, even though we're in the first inning of execution of the business model, just pulling the scale and the company together and all of the social selling tech to kind of put that on nuclear overdrive, Aaron, we have all these tailwinds behind us that are headwinds for this trillion-dollar consumer goods industry, but tailwinds for us.

我們看到了健康產品的真正趨勢以及消費者攝取更多健康產品的需求，因為他們認識到自我照護是新的醫療保健，而我們正處於這一趨勢之中。坦白說，影響購買行為和購買決策的不再是電視廣告，也不是印刷品或諸如此類的東西。這不是傳統零售的銷售點行銷。這是口耳相傳。人們的社會費用影響著世界各地超過 90% 的購買決策。你猜怎麼著，那也是我們。因此，從商業模式的角度來看，儘管我們正處於商業模式執行的第一階段，只是將規模和公司整合在一起，並利用所有的社交銷售技術使其進入核超速狀態，但 Aaron，我們身後有所有這些順風，這些順風對於這個萬億美元的消費品行業來說是逆風，但對我們來說是順風。

So if I could go back in time and be Monday morning quarterback, I wouldn't change a single thing right now in our business model. I would accelerate it and get it done faster, I would get more scale because the benefits of scale, as we pointed out to investors, really has the benefit on lower SG&A and higher EBITDA margins. So that is still our focus in the short-term of drive more EBITDA margin, drive free cash, drive positive operating income margin. But as we continue to do that, we want to drive the top line, and we have all these tailwinds behind us that will support our execution of the business model. But even if I had hindsight, I wouldn't change a single thing of the business model today.

所以，如果我能回到過去並成為週一早上的四分衛，我不會改變我們現在的商業模式中的任何一件事。我會加速它並更快地完成它，我會獲得更大的規模，因為正如我們向投資者指出的那樣，規模效益確實有利於降低銷售、一般和行政費用 (SG&A) 並提高 EBITDA 利潤率。因此，我們短期內的重點仍是提高 EBITDA 利潤率、增加自由現金流、提高正營業利潤率。但隨著我們繼續這樣做，我們希望推動營收成長，我們身後有所有這些順風來支持我們執行商業模式。但即使我有後見之明，我也不會改變今天的商業模式中的任何一點。

That's really helpful color. And then if I could just ask a third question, kind of putting some of the pieces together here, right? So about $100 million for the quarter, you'd peak about $125 million, $126 million in the first quarter. It sounds like it's going to be some time to get back to that peak level, high-single digit, put around $108 million, $109 million for 4Q. So is it fair to think that get to that $125 million, $126 million run rate is going to take some time for you guys. And it's better to think about that mid- high single-digit sequential growth rate as being the best kind of measure kind of going forward for the next couple of quarters?

這確實是很有用的顏色。然後我可以問第三個問題嗎，把這裡的一些部分整合在一起，對嗎？因此，本季的營收約為 1 億美元，第一季的營收高峰約為 1.25 億美元、1.26 億美元。聽起來需要一段時間才能回到峰值水平，高個位數，第四季約為 1.08 億美元、1.09 億美元。所以，你們認為達到 1.25 億美元、1.26 億美元的運行率需要一些時間嗎？最好將中高個位數的連續成長率視為未來幾季的最佳衡量標準？

Well, I think, again, we're not giving guidance yet, and we're certainly working on the 2022 plan. I think as the pandemic becomes an endemic, we'll get a better view as to our ability for our brand partners to be together. And then certainly, as Brent mentioned, we've got some new products that we've introduced here in North America that seem to be off to a pretty nice start. So I think there's plenty of optimism, but we'll put numbers on it when we talk again in March.

嗯，我認為，我們還沒有給出指導，我們當然正在製定 2022 年計劃。我認為，隨著疫情成為一種地方病，我們將更了解我們的品牌合作夥伴團結在一起的能力。當然，正如布倫特所提到的，我們在北美推出了一些新產品，似乎取得了一個不錯的開局。因此我認為還有很多樂觀因素，但我們將在三月再次討論時提供具體數字。

And I would say just to follow-up on that, Kevin's right, we're going to take a cautious under-promise approach, and we'll come back to you in March. But I've just been out with our group President, Mark Wilson, who I continue to believe, is by far and away, if not the best, one of the best in this industry at what he does. And he and I have just been out. He was in Spain. Our teams were out doing business partner meetings in Germany, in the U.K. and then I got to participate in like 1,000 person kind of meetings in France and Italy over the past couple of weeks, and we had a huge one in the U.S. and another one coming up this weekend in the U.S. So we are getting back out to do the business, and the excitement of this company, and I hate to, and I don't want to overstate it, but the excitement in the company and the optimism in our company is palpable. So we're just going to build on that, and build on that momentum and belief.

我想說的是，為了跟進這一點，凱文是對的，我們將採取謹慎的、不輕易承諾的態度，我們將在三月回覆您。但我剛剛和我們集團的總裁馬克威爾遜（Mark Wilson）出去了，我仍然相信，他是迄今為止最好的，即使不是最好的，也是這個行業中最好的之一。我和他剛剛出去。他當時在西班牙。我們的團隊在德國、英國舉行業務合作夥伴會議，然後過去幾週，我參加了在法國和義大利舉行的大約 1,000 人的會議，我們在美國舉行了一次大型會議，本週末還將在美國舉行另一場會議。所以我們只是在此基礎上再接再厲，鞏固這股動能和信念。

But I would say to all of the investors, look, thank you for your confidence. Thank you for participating in our call today and for the continued support and interest in NewAge. We're going to be participating in the ROTH Corporate Access Conference coming up and at the ICR Conference coming up in January. So thank you for the questions today. And please feel free to reach out at any time if we can answer any additional questions. And thanks for the continued confidence, support and belief to all of our very value-added investors. Thank you.

但我想對所有投資人說，感謝你們的信任。感謝您今天參加我們的電話會議以及對 NewAge 的持續支持和關注。我們將參加即將舉行的 ROTH 企業訪問會議以及一月份即將舉行的 ICR 會議。非常感謝大家今天的提問。如果您有其他問題，請隨時與我們聯絡。並感謝對我們所有增值投資者的持續信任、支持和信念。謝謝。

All right. And ladies and gentlemen, that will conclude the conference call for today. We thank you for your participation, and you may now disconnect your lines. Thank you.

好的。女士們、先生們，今天的電話會議就到此結束。感謝您的參與，您現在可以斷開線路了。謝謝。