We are ready to begin with our next presentation. If we can have everyone seated, please. Any additional discussions or questions can be addressed outside. Thank you. Awesome. We are excited to welcome both gentlemen to the stage today. We have CFO Brian Meadows and CEO Scott Harvey of Jones Soda.
[inaudible] Good afternoon. Thanks for joining us today. I am Scott Harvey, CEO of Jones Soda, and Brian Meadows, our CFO. I want to take you through a little bit of our history, about what has been going on the last two years. Brian and I both joined about two years ago. Jones, back in 2025-ish.
2025.
2025. We want to take you through the story, where we are at, what happened, where we are at, then open it up for questions. We will walk you through some of the investor deck that we had put together. Company overview. Jones is a 30-year-old startup. It has been around for 30 years. Many different changes in ownership and leadership throughout the years. Started in Vancouver.
Yep.
Transitioned over the border to Seattle, and we are now a Seattle-based company. Part of the brand is it is really about the portfolio and how we plan to expand this. Really trying to evolve this craft soda business because we believe that what we do, we are the best at it. We do not use HFCS. We are full cane sugar that is in there. We span multiple categories. We will get into those categories here shortly in regards to what they are and what they cover and why they are important to us. You can see some of the product offerings that we have had on the side. Some of you may that follow us, do not follow us.
We've done a very significant job over the last year with what you see up in the upper right-hand quadrant, which is Nuka-Cola Quantum, and that is a partnership that we've developed with Fallout, which is a Bethesda property. Fallout, for those of you who do or do not know, is a video game, and it's also a TV series that appeared on Amazon this year. We'll get a little bit more into what did that mean to us and what did we do for it. We also launched this year, ZEROs. ZEROs, I think are a big difference for us and a big mover for us. Why? Because I believe in today's age, where people are very conscious about their health, are looking for alternatives.
I also think that over the years, that we've lost some of our consumer base just because we are a full sugar product. So introduction of the ZEROs gives our consumers the opportunity to come back to a brand and a flavor profile that they love, but with the less sugar that they're looking for today. Again, a couple of the other examples down at the bottom are Sunset Sarsaparilla, which is part of the Fallout series. We also did an America 250 pack that we launched in Texas throughout the Costco chain. The product and partnership growth, as I said, has been very important to us, to our turnaround that we've been doing over the last two years. It's really about the Fallout partnership. We've done partnerships with Crayola.
We have a partnership with Folds of Honor, and we have some other ones that we will be making announcements on as we end the year and beginning of next year. The other piece that we spent a lot of time when we entered into the business was really establishing the financial discipline with the business. When we arrived, many people were able to sign contracts, do deals, do everything with no formal process in place. What Brian and I have put into place is that nobody in the company signs contracts, nobody offers any sales pricing unless it goes through a rigorous process to make sure that the economics and the deal terms make sense for us. We also have no issues with walking away from a deal if things don't make sense for us.
Again, the leadership that Brian and I bring, I think has helped the company turn from where it was when we got here to where it is today. My background is in restaurants and in manufacturing and CPG. Spent the last 30 years working for brands such as Nathan's Famous, Black Rifle Coffee Company, Einstein Noah Restaurant Group, where I've done multiple leadership positions throughout there, from running manufacturing plants to doing the running operations of store operations and doing CPG sales as well. I'll let Brian touch on that, on his background here in just a second. Matter of fact, I'll turn it over to Brian to do a brief company snapshot.
Thank you, Scott. I'm Brian Meadows, CFO. I joined in January of 2025. I was previously with TRUBAR, if you know that protein bar. I was involved with that for five years. We bought it for $7.5 million, and last year it was sold for over $200 million. So took the same approach there. Great product, just was run poorly, put into the discipline as Scott talked about. Brought in some of the similar partners we have with that business, and that's been paying off pretty remarkably in the last, I'd say year, basically, right? We're just looking at the share price, an area that we are not obviously pleased with, but it's been kind of a flat line. $0.26 was a very recent close. 52-week high of $0.40. Almost 126 million outstanding common. Market cap at 33.
In terms of fully diluted, we do have about 5 million warrants and a little over 10 million stock options. About 140 million fully diluted. Enterprise value, including our short-term debt, which is a revolver. We have a $10 million line of credit that we use to really fund some of our big customer opportunities like Costco. As of the end of the second quarter, it was [$3.7 million].
Got it.
Oh, you got it. Thanks.
Yeah.
Okay. Just looking at what is our progress on net revenue, and we will talk about other metrics as well. 2023, $16.7 million. That grew about $1 million in 2024, $17.8 million. I believe the EBITDA loss was around $7 million that year. That is prior to Scott and I coming in. Last year, we got it up to $25.3 million, 40% growth rate. We cut the EBITDA loss to a little over $2 million. This year we are guiding $45+ million and adjusted positive EBITDA this year. That is an 80% growth rate, and we will be reporting our third quarter on the 10th of November. I will turn it back to Scott.
Great. Thanks, Brian. Again, the Jones advantage that we talked about before, one, we are a 30-year-old brand that people love and trust. There is not a place that I go into, a plane that I am on, or if I wear a Jones shirt that somebody does not know who Jones is. I think in one of the previous conferences we were at, we talked to so many people, and there was only one person who did not know about us. So you would think that we should be a half a billion dollar company because of the brand awareness of who it is. I think adding some of the partnerships that we have done is creating and it is increasing that image of the brand as we continue along. The distinctive taste, we do things people do not.
Who else puts out a soda that is turkey and gravy? We do those things, right?
Because we are unique, we are creative, and we can do these things fairly quickly because we are a flatline organization. There is not a lot of approvals to go through. However, we do not do it unless there is a reason and the economics make sense for us. When we talk about the portfolio, we have changed the portfolio from when Brian and I got here. There were three previous ones, and we have gone back and looked at it as to where do we want to play as the continued growth of Jones continues over the next several years. We look at either core beverages, which we will touch on on the next slide, consumer lifestyle, and then functional health. Functional health is a word that you hear more and more today, specifically if you relate to GLP-1s, metabolic health, and so on and so forth.
There is a whole segment of that category that we think is room enough in there for Jones to play in and actually make a difference and continue to grow our top-line sales. Again, it is about trial and repeat. There is nothing more happier than me when I can come in and see our brand on something, whether it is on a Fallout pack, a Crayola pack, Folds of Honor, a Jones on shelf. We are building those impressions and building muscle memory with folks as to who it is and where we are, as well as those unique and delicious flavors that we are able to create for folks. When we talk about building the next Jones for us, there was three segments of this. One, 2025 was really about stabilizing the business.
Brian and I got here, and there were some weeks we didn't know if we were going to keep the lights on. Brian would remind me, hey, there's light at the end of the tunnel. However, we didn't know if there was actually light or it was a train coming at us again. Every day was an adventure for us, but we were able to go back, and through our experience in leading other companies was really just strengthen our balance sheet. We were able to put in process and control that we weren't just spending money as they had in the past. What happened in 2026 this year, it's the accelerate growth. It's really about expanding our core business and our lines.
It's launching those innovative products, such as any of the Fallout packs of flavors that are in there, the ZEROs that we've managed to launch this year. Leverage new partnerships. We have those partnerships, but I can tell you'll be hearing more about partnerships by the end of the year or early in the first quarter as we continue to work on those because we believe it is a great opportunity for us to do things that the big guys won't do and that we can do them quicker and faster and more unique than anyone else that's out there. The other one is broadening our distribution and reach. There's a lot of white spaces across the country that we're not in yet. We've got to figure out a way to be able to get in there and do that.
For 2027 and beyond, it's really about scale growth through our growth platforms. I think for us, we can continue to see that upward churn and what we've seen so far in building each one of those platforms within there. D2C was nothing when we got here. We were doing about $100,000 the first year that we got here. Last year, we did about $1 million. This year, we're about $5 million in D2C. We're in a major overhaul project of the website now to be able to institute subscription-based services on there, which didn't exist today. We're working on shipping, just making the site more usable and a better experience for consumers when they come in here. What's the baseline for this? It's really creating that lasting value, which is through, one, get the sustainable revenue growth, which we're showing.
Again, trust will come as we continue to bolt on quarter after quarter. Expand our profitability from where we were seeing losses to going out and making a statement that we're forecasting adjusted positive EBITDA for this year. Generate strong cash, which means still working the middle of our P&L and looking for opportunities for us to be able to improve margin. Most importantly, it's really increasing the shareholder value, of which we are centrally focused on because Brian and I are investors. We put up some of our own money to go back and reinvest in here because we believe in what Jones has and what Jones has to offer. When we talked about the scalable growth, here's the three platforms that we were talking about, core beverages, consumer lifestyle, and functional health. Right?
Again, when you look at core, it's our Jones Soda, it's our ZEROs, and it's craft innovation within there. It's also each one of them, you'll see something on the bottom of it, which is M&A opportunities. If we can find opportunities for mergers or acquisitions that are accretive to us, that are similar to us, it's a great opportunity for us to continue to grow, but without causing major disruption within our brand. Consumer lifestyle, is that a buzzword? I don't think so because I think it's applicable to what we do. It could be a snack that we create, but it's not there yet. We don't want to not discount that as well. Beverages, alcohol. I just told Brian, and he didn't even know this, we just got our national alcohol license. So we now have a national alcohol license should we want to pursue that.
We have an easier pathway to get there now that we actually have a national license. License and branded products I spoke about, continuing to move forward. I think this is a great opportunity for us. Functional health could either be gut health, GLP-1, metabolic health, or healthy aging. I think most of you may or may not know, but there is a third of the U.S. population that doesn't know that they're either diabetic or pre-diabetic today. They just don't know that. I think that we are working on innovation today, which is in clinical testing today, that we believe that we have something that we're going to be able to roll out at the beginning of next year that helps address some of those needs that are out there for consumers that are looking to control their health, whether it be gut or functional.
How do we do those? Those enablers, again, are licensing and partnerships, gaming and entertainment. Fallout's been a big one for us. The M&A opportunity, innovation, D2C, which I think is not anywhere where it needs to be today. Again, the long-term value creation is for revenue, profitability, and that shareholder value. Like I said, we talked about partnership. The three biggest ones we had this year was Fallout, Crayola, and the Folds of Honor there, which is a giving back to veteran organization. The Fallout Bethesda was here before Brian and I got here, however, they did not maximize that opportunity. Brian brought in a gentleman that he knows, that I so kindly call him the Costco whisperer, and he actually helped us develop products to be able to launch within Costco. It happened October through December of last year.
They wanted to do one rotation, one area of the country. They wanted 24 trucks. Sold out within a week. They came back to us and said, how quickly can you make 295 trucks more? Based upon what we were able to do it. It goes into Costco, and it's not only just a flat 12-pack, it's a premium. It's premium priced. The packaging is unique, as well as that we have premiums inside. There's a little pouch, and again, if you're a Fallout fan, you know that bottle caps inside the Fallout game are currency. So we're giving their Fallout fans something that they wanted and would desire and are unique that they weren't getting before. To top that off, Blue Star bottle caps are even more of a value to them. So we actually drop them randomly through there.
We have done that through each one of those rotations, where we are able to engage with a community that is looking for something that supports their entertainment features when they are off work or such. Crayola, great interaction from that. It is back to school. We are re-upping our Crayola partnership again for next year, and we are focusing on greater distribution within other retailers. This year it was D2C and selected retailers that wanted it and opted into it, but it was not broadly shopped. What we are hearing today is that there are more retailers that are wanting to bring that in. Why partnerships? Because it broadens our reach, it creates more impressions of our brands as it goes on, and we are able to do it better than some other.
Somebody asked me today, why you, and why is not Coca-Cola and them doing it?" It is probably not worth the scale of what they are doing, but we can do it very creatively and very quickly. Why Fallout? Fallout, if you play it, the sodas appear in the games. What does not appear in the game is what do they taste like? It gives us the ability to be able to create the flavor for the Fallout fans. We have something on our website now. There is a soda that is coming out next year. In the game, it is also called [Vim], but it has no flavor. So we have gone back to our consumers and our followers and go, tell us what you think it tastes like. Here are three options.
Pick one of these, and that is what that flavor will be as we roll it out next year. Again, Fallout, the engagement, the first one we did, we launched it, and boom, it popped up 27.5 million impressions. We did not have the cash to pay for that. This was through social media. It got replayed. It got replenished. The gentleman you see in the picture there, he is one of our biggest advocates of our brand. Every time he hears something or sees something, he is online talking about Jones and what Jones is doing for the Fallout fans. Again, our 2026 club expansion, we did Sunset Sarsaparilla. Sunset Sarsaparilla happens to be a factory inside the Fallout game, and it is a root beer-ish, vanilla-ish type thing. Sold out incredibly in those releases.
Again, we still have two years left on the Bethesda agreement, of which we will continue to do additional rotations with that. We talked about D2C net sales. Shopify net sales through August of this year, $2.69 million. We have had 55,000 orders, which is an increase of 355% over the prior year and 3.82 million site impressions, which is another 434% versus the prior year. Again, partnerships are bringing people to our site. Our job now is to figure out how do we complete the conversion. Once we get them in there, how do we get them through the cart and through the checkout process? We also have to get through there to be able to start collecting data on our consumers. Where do they live? Where do they shop? What do they do? How do we market to them? All of those things are critical.
Thus, the reason why we're actually reinvesting and rebuilding our website, so we have these abilities to be able to collect that data. The Fallout rocket bottles, these are very unique. They are numbered. They're actually blown in Italy, decorated in Poland, and then they're filled here in the U.S. and shipped back out. Collectible items. We launched the first one and sold out within a week. Somebody may say, well, how many did you sell? We sold 20,000 of them in a week. Again, if you look at our price point, they were $65 a piece, including shipping on there. We just launched Orange. We're already over the 11,000 mark on Orange rocket bottles, and there's a little bit of a clue here.
Nuka Cherry is there, so stay tuned to Nuka Cherry because you may or may not see that coming out by the end of the year. Again, building the demand through fandom and collectibles, it's a great avenue for us. People say, well, what happens when Fallout falls out? Again, that's why we're out shopping, and we're soliciting other partnerships for us to be able to do that. Also, what it's done for us, it's given us the opportunity to talk to more retailers that wouldn't have talked to us last year because all of the retailers follow each other and what they're doing. We're getting calls from people that probably would have never talked to us. We've got a launch.
We're launching into H-E-B in Texas upcoming in November, and we've got into all of the stores, over 240 stores, as well as eight facings, which is huge for us. Versus what we see in some of the other stores, it's two to three, but eight facings in H-E-B is a big deal for us. As well as that we've gotten calls from other retailers about, hey, we've got an anniversary coming up. Can you do a rotation in, say, 10,000 stores? Sure, we can do that. We'll figure it out. We have the ability to be able to do that. Again, expanding Jones' reach across the club retailers, multiple Costco rotations sold out. We continue to court them. We continue to present items to them. We've already presented all of what 2027 looks like to them, so we're already aggressively on that.
We started working on 2027 for some of these rotations as early as June of this year. Direct store, the DSD piece, there's new regions, broader availability. There's still a lot of white spaces for us that we have to go and find out how do we get in there and get distribution because we do hear from our fans, where can I find it? When can I get it? Again, continue with our online growth. Some of our distribution channels, and they're pretty common. When you look at retail and club, it's Costco, it's Albertsons, it's Hy-Vee, Meijer, H-E-B. Walmart's a big play. Up in Canada, it's Circle K and Couche-Tards up in the Montreal area. We've got 1,750 stores up there. Distributors, all the majors, UNFI, KeHE and so on. Again, online and D2C, Amazon, Gopuff, and of course our own site of Jones.
This year we are up to 35 + DSD distributors in 2025. Again, leadership team, it is Brian and myself as well as we have brought in other industry leaders such as Eric Schnabel. He worked over at Meta as one of their lead senior officers over there. Darcey Macken comes from Kellogg. She is our Chief Operating Officer and leads all of our sales. Brian, Ryan, I brought him in. He used to work for me at Black Rifle, running our supply chain now. So he is really diving in and really trying to work the mechanics of that, as well as a board that you cannot ask for. These guys are the most supportive group of individuals that I have come across in my career. They are willing to listen, willing to roll up their sleeves.
I was actually on a phone call with them at [6:00 A.M] our time, and the gentleman happened to be over in Europe, because he was working on something for us on his own time. So for our board members, you cannot ask for a better group of supporters, as well as their backgrounds are just phenomenal. You have got Kellogg, you have got Kimberly- Clark. Ron Dissinger was the CFO for Kellogg. What better guy to be able to help us when we start talking about financing and doing things? So for us, we are super fortunate to have these individuals help supporting us as we grow. Again, investment highlights really, what do we want to get out of this? It is our portfolio expansion. It is about new consumer occasions, really, the reduced sugar and giving opportunities for people to try our brand.
It is strengthening our brand, which was not here when we got here, and it is today. It is instilling that financial discipline that nothing gets done unless it goes through a process. Some people may say it is overburden. I say it is very prudent on the way we want to be able to manage our business going forward, because we did not own what happened before we got here, but we sure do own it today, and we are not going to go back and visit that. Really, the leadership team. I think that we have got a great leadership team in place, and we will always continue to look for other talent to come in and help support us on our growth efforts. But we are also very conscious of headcount creep.
So, Brian keeps me on track of going, telling me, you can, or should not do that this time. I think that wraps up our.
Time for questions.
We've got five minutes left for questions. Yes, sir.
[inaudible]
The question was, in terms of scaling, is this all through co-packers? Yes. We do not own any of our own manufacturing facilities. Yes, we do have co-packers, and we're actually expanding those for continuity as well.
[inaudible]
I do not have any samples with us today. Yes, sir.
You said the portfolio is currently reduced sugar or no sugar. [audio distortion]
When you look at the ratios today, it is probably like [95/5] right now because we just launched it in the last quarter. I would see that mix changing over a period of time as we start to market it and tell people that it is available, because again, I think consumers want it and they are looking for it. Yes, sir.
You had mentioned [audio distortion] no sugar, low sugar [audio distortion]
Yes, sir.
[audio distortion]
It is not. No, and it won't even actually be launched under a Jones brand. It will be separate from that because it's kind of like an oxymoron for me to tell you to drink all the sugar product. Then I'm going to give you something to make you not utilize that sugar piece. So yeah, it will be launched under a new line. We just launched a subset of our company called Jones Labs, and it will fall underneath there under a different brand name. Yes, sir.
[inaudible]
Would we ever consider going private?
We're always looking for what is going to create the most shareholder value. Right now we're focusing on uplisting to NYSE American Exchange as what we think is going to be key to better liquidity and valuation, that we are targeting for the first quarter of 2027. If the right offer came along, that could be a much larger beverage company. Given the success we've demonstrated, it's not out of the realm of possibility to get those kind of conversations.
Any other questions? Yes, sir.
Volume deal is great for you guys, but at the same time, your sales skyrocketed, but your profits per bottle went down significantly. What are you doing to correct that?
I'll answer that one.
Okay.
I'm surprised that's how you see that. Our overall, we are going to be adjusted EBITDA positive. Were you talking about gross margin level? What was your determination?
[audio distortion]
Okay.
[audio distortion] bottle went down.
You're going to see that improve in the third and fourth quarter. Part of that was driven by fuel prices this year. That is a significant weight on the gross margin. I'm confident you're going to see much better performance. The other part of that is last year we had a HD9 business, which had about a 10 percentage point higher margin in general. That business is done. As you know with the legislation, you can only have a one gram product, thank you, as of November 14th or something like that. We're out of that business. That was bringing up our margins. You're going to see good things third quarter and fourth quarter.
Any other questions? Well, hey, we want to thank you all for spending time with us today and listening to the Jones story. Stay tuned, follow us, look for our press releases coming out. Like I said, our earnings call is on the 10th of November. We are very excited and very optimistic about the balance of the year and what 2027 brings us. Thank you all.
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