Celsius Holdings, Inc. (CELH)
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May 4, 2026, 1:14 PM EDT - Market open
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Earnings Call: Q1 2020
May 12, 2020
Greetings, and welcome to the Celsius Holdings, Inc. 1st Quarter 2020 Earnings Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded.
It is now my pleasure to introduce your host, Cameron Donahue with Hayden IR. Thank you, Mr. Donahue. You may begin.
Thank you, and good morning, everyone. We appreciate you joining us today for Celsius Holdings' Q1 2020 earnings conference call. Joining me on the call today are John Fieldly, President and Chief Executive Officer and Edwin Negron, Chief Financial Officer. Following the prepared remarks, we will open the call to your questions and instructions will be given at that time. The company filed its Form 10 Q with the SEC and issued a press release today.
All materials are available on the company's website at celsiusholdingsinc.com under the Investor Relations section. As a reminder, before I turn the call over to John, the audio replay will be available later today. Please also be aware that this call may contain forward looking statements, which are based on forecast, expectations and other information available to management as of today, May 12, 2020. These statements involve numerous risks and uncertainties, including many that are beyond the company's control. Except to the extent as required by applicable law, Celsius Holdings undertakes no obligation and disclaims any duty to update any of these forward looking statements.
We encourage you to review in full our Safe Harbor disclosures contained in today's press release and our quarterly filings with the SEC for additional information. With that, I'd like to turn the call over to President and Chief Executive Officer, John Fieldly for his prepared remarks. John?
Thank you, Cameron. Good morning, everyone, and thank you for joining us today. First, our thoughts and prayers are with all of those who have been impacted by COVID-nineteen. And I want to thank all of our CELSIUS team members and partners for their dedication, efforts and support. We're incredibly proud of our team who have maintained the integrity of our operations and performance.
The macro environment during the Q1 of 2020 was unlike any other we have seen in recent history, challenging organizations to respond in new and creative ways to manage and grow their business. At Celsius, we rose above the challenges and set another new sales record with quarterly revenue of $28,200,000 an increase of 95% over last year. North America revenue was up 70% and Europe was up exponentially, due in part to our accretive acquisition of Funk Food Group late in 2019 and Asia was up as well. Consumer demand in the beverage industry continues to trend towards the pursuit of healthier alternatives versus conventional beverages. Although consumer traffic and purchasing patterns have been severely disruptive, traditional shopping habits gave way to tremendous increases in online ordering, curbside pickup, pantry purchasing, while consumers complied with the stay at home orders.
To meet consumer demand, we secured additional distribution agreements with partners in our primary U. S. Networks, including Anheuser Busch Imbeth, PepsiCo, Keurig Doctor Pepper and Molson MillerCoors Distributors, which further expanded availability to new regions. We are continuing our quest to build a national distribution network, which now includes more than 100 regional DSD or direct store delivery partners. Our DSD partners also provide us with additional routes to market for incremental points of growth.
In addition, we transitioned Target and 711 from the wholesale network to our DSD partner Big Geyser in New York Metropolitan Area and saw volumes more than double. Across the board in the U. S. Market, stores that we have transitioned to the DSD network saw on average a 40% increase in sales volume on top of our 30% same store sales growth rate. We're planning for more planning on more accounts transitioning to DSD partners and the DSD network throughout 2020 as we continue our pursuit on reaching more consumers at more points of distribution.
With the recent news of Bang Energy transitioning to the PepsiCo distribution network, this event has further opened up additional opportunities for Celsius to gain additional distribution partners as we continue to expand our net to a national network. During the quarter, we launched nationwide availability of our product at more than 15 100 store locations through Walmart, the country's largest retailer. Early data from the retail channel indicates strong reception by its consumers and we expect additional flavors to be added in the next reset. In addition, we implemented and launched within Walmart about 50% split between DSD and going direct through their warehouse further expect to transition over these existing Walmarts to the DSD network through the back half twenty twenty as we gain additional coverage. In addition at Target, one of our key retail partners, we expanded our product assortment to 5 flavors nationwide with the addition of great tasting grapefruit green tea.
We introduced our newest flavor, refreshing and exotic jackfruit, a tropical taste with a burst of sweetness and a tangy twist available in our new Celsius heat packaging. The standout packaging and label redesign position the brand as highly credible and sets the stage for the next phase of growth. Its visual effects reinforces our brand our brand structure and function claims, which are clinically proven and a clear differentiator among brands in the performance energy category, while appealing to a broader audience. Clearly, our momentum continues in the Q1, despite an extremely volatile and uncertain business environment brought to us by the COVID-nineteen virus. Our success in the Q1 was driven by several key factors that are unique to Celsius and give us a strong competitive advantage.
We have an extremely strong brand, a diverse and growing network of retailers, distributors and partners and a strong balance sheet that enables us to rise above challenges that many companies are facing amidst the COVID pandemic. As early as late December, we began increasing product and raw material inventories in anticipation of resets with major retailers that were planned for the March April timeframe. The strength of our balance sheet enabled us to continue to build inventories during the quarter despite the demand as the virus situation unfolded, while other brands were impacted. We were very well positioned in the Q1 when the grocery, mass channel and drug channel partners increased orders outside of their normal ordering patterns as shelves were emptied as a result of consumer pantry purchasing. As supply chains returned to more normal levels with shelves adequately stocked, our throughput remains steady.
And due to our decision around inventory management at a higher level of support, we were able to provide our retailers, distributors and partners. In addition, also being located in Hurricane Alley in South Florida, we were well positioned with contingency operation plans in place, making our transition to many of our workers who are now working from home very seamless. Critical to our growth plans is our marketing strategy that creates meaningful and emotional connections with consumers. Up until the COVID virus pandemic, a significant component of our marketing strategy primarily consisted of live integrated programs that reached a critical mass of consumers at large gatherings. Our Lift Fit tour, for example, integrated fitness and competitive activities, where we reach tens of 1,000 of new consumers in high energy settings.
With the stay at home orders, large gatherings of people at events came to a hard stop, and we were challenged to quickly pivot our marketing strategies and find innovative ways to get in front of consumers. As a small nimble organization, we quickly shifted our marketing resources from experiential offline activation to online programs that enable consumer connections and create a different yet meaningful experience. One example was in April, where we launched a Sweat with Celsius, a virtual workout platform that is live streamed on our Instagram account. With the gyms and fitness centers closed across the country, we're used Instagram platform to facilitate consumer connections through at home workouts. The program consisted of 3 weekly workouts hosted by well known local fitness trainers located throughout the country.
The different workouts offered followers a chance to try new workouts, release stress and maintain a sense of normalcy. The workouts require minimal to no equipment and can be modified for all fitness levels. In addition to sweat with Celsius, we also partnered nationally with Berries, a leader in the fitness space and its at home live Instagram series, where is profiled as the official energy drink powering Berry's at home streaming workouts. The partnership is helping communities come together and continue to live fit even outside of the gym. We are also deploying more online campaigns to deliver tens of millions of additional impressions to highly targeted audiences, such as with our sponsorship of the Energy aisle within Instacart, a leading home grocery delivery service.
In addition, we're leveraging walmart.com, target.com, bodybuilding.com and Amazon as we continue to gain momentum. Most recently, we're able to get data from StakeLine, which tracks energy drink sales on Amazon in the United States. And for the 13 weeks ending April 11, 2020, sales in dollars in the energy drink category within Amazon versus the same period a year ago indicated Celsius sales growth of 118.2 percent and its share increased 2% within the category to 11.4%, which further demonstrates the momentum we are building in the category with Celsius. Celsius was ranked the 3rd largest brand in the category behind Monster and Red Bull. While our highly talented marketing team quickly shifts our approach from offline to online, we fully expect to pivot just as rapidly back to offline as gyms begin to reopen and consumer gatherings and events are given the green light.
This may look slightly different than it did before the virus, perhaps with more outdoor workouts and smaller gatherings, but we're already planning and positioning for activation in the second half of 2020 when we are given the signal. In Europe, we further integrated the Funk Food Group in our operations and are seeing great benefits and see additional future synergistic opportunities. In addition, the team further improved their operational performance through improved focus and execution, which we are very pleased with. Celsius, it was reported, was amongst the fastest growing energy drinks in the Sweden market during the Q1 per Nielsen scan data. During the quarter, the team successfully launched a great tasting
a great tasting tropical flamingo
flavor with great success, leveraging superior in store execution and targeted experiential marketing programs, which drove strong year. We remain focused on driving profitable growth by expanding and increasing our distribution networks, nurturing relationships with new and existing accounts and engaging consumers through a variety of creative mediums. We are very we are successfully growing in an industry that is rapidly changing and quickly adapting the changes in the broader market. While it's difficult to predict what, if any impact macroeconomic shocks will have on our business over the few quarters, we remain confident in our ability to maintain our momentum over the long term and capitalize on the growing consumer demand for healthy functional beverages. As we enter the Q2, we are seeing growth in April orders.
And in North America, we have seen growth of approximately 38% over the prior year, which provides us further confidence on our ability to maintain our momentum in the category. Notwithstanding the foregoing, the uncertainties resulted from COVID outbreak may have unforeseen and unexpected impacts on the results of operations. I will now turn the call over to Edwin Negron Cabala, our Chief Financial Officer for his prepared remarks. Edwin?
Thank you, John. For the 3 months ended March 31, 2020, revenue was a record high $28,200,000 an increase of $13,700,000 or 95 percent compared to $14,500,000 for the same period last year. The overall increase in revenues was due to increases in sales volumes as opposed to increases in product pricing. By geography, the 95% revenue increase was attributable to continued strong growth of 70% in North America, reflecting double digit growth from both existing accounts and new distribution expansion, including expansion at world class retailers. Consequently, North American revenue delivered a record $19,400,000 for the quarter or an 8,000,000 or an increase of $5,500,000 compared to the Q1 of 2019, reflecting the full impact of consolidating the results of our European operations.
Asian revenue totaled $268,000 compared to $53,000 in the year ago period. Asian results for the 1st quarters of 2020 2019 are now comparable as both peers reflect a change in our China business model to a royalty and license fee arrangement effective January 1, 2019. Revenue from all other areas amounted to $57,000 Gross profit increased by $7,300,000 or 127 percent to $13,000,000 in the Q1 of 2020, up from $5,700,000 in the year ago quarter. Gross profit margin for the 1st 3 months ended March 31, 2020 was 46.1%, which compares favorably to 39.5% for the 2019 quarter. The increase in gross profit margin and dollars reflects the impact of the consolidation of the European operations and the result of the increase in sales volumes across all geographies as opposed to increases in product pricing.
The increase in gross profit margin translated to an incremental $1,900,000 of profitability in this quarter. Selling and marketing expenses for the 3 months ended March 31, 2020 were $7,500,000 an increase of $3,900,000 or 108 percent from $3,600,000 for the same quarter in 2019. The increase is mainly due to the impact of the consolidation of the operations of our Nordics partner, which was not reflected in the 2019 results. Consequently, marketing expenses increased $1,600,000 or 132% compared to the Q1 of 2019. Similarly, all other sales and marketing expenses reflect the increases related to the consolidation of the European operations.
Specifically, employee costs increased $1,500,000 or 114% from the 2019 quarter to the 2020 quarter and also reflect investments in human resources to properly service our markets. Moreover, due to the increase in business volume, our support to distributors and investment in trade activities increased by $353,000 and our storage and distribution costs also increased by $486,000 General and administrative expenses for the 3 months ended March 31, 2020 were $4,200,000 an increase of $1,600,000 or 62% compared to $2,600,000 for the 3 months ended March 31, 2019. This increase similarly reflects the impact of the consolidation of the operations of our Nordics partner. As such, administrative expenses reflected an increase of $1,100,000 which included an addition of $221,000 to our bad debt reserve in order to cover potential collectability risks associated with the COVID-nineteen situation. Employee costs for the 3 months ended March 31, 2020 reflected an increase of $302,000 or 47 percent, not only related to the consolidation of our European business, but also reflecting investment in resources in order to properly support our higher business volume.
All other increases for general and administrative expenses amounted to $232,000 when compared to the prior year quarter. Below the operating profit line, total other expenses were $702,000 for the 3 months ended March 31, 2020, which reflects an increase of $12,900,000 when compared to the prior year results, which included a gain of $12,200,000 related to the recognition of a note receivable in connection with the change in our China business model at the beginning of 2019. Furthermore, the results for the 2020 quarter include amortization expenses of $310,000 total net interest expense of $273,000 foreign exchange losses of $78,000 and all other items amount to a net expense of $41,500 As a result of all this activity, the company had net income of $546,000 or $0.01 per basic and diluted shares for the Q1 of 2020 compared to net income in the year ago quarter of $11,700,000 or $0.19 per diluted shares, which included the $12,200,000 gain on the recognition of the note receivable. Adjusted EBITDA was $2,800,000 compared to $878,000 for the Q1 of 2019. We believe this information and comparisons of adjusted EBITDA and other non GAAP financial measures enhance the overall understanding and visibility of our true business performance.
To that effect, a reconciliation of our GAAP results to non GAAP figures have been included in our earnings release. As of March 31, 2020, the company had cash of $19,100,000 compared to $23,100,000 as of December 31, 2019. The company also had working capital of $27,400,000 as of March 31, 2020 compared to $24,800,000 as of December 31, 2019. Cash used by operations during the 3 months ended March 31, 2020 totaled $3,800,000 reflecting an increase in working capital used mainly related to an increase in inventories of $5,500,000 to support our business growth and as a precautionary measure to minimize any potential disruptions in the supply chain regarding the COVID-nineteen situation. That concludes our prepared remarks.
Operator, you may now open the call for questions. Thank you.
Thank you. We will now be conducting a question and answer Our first question comes from the line of David Baines with ROTH Capital Partners. Please proceed with your question.
Great. Thank you and congratulations on a great Q1. I'm hoping you could opine further on the broader functional energy segment activity and potential repercussions for Celsius. You kind of touched on in the prepared remarks, but when we look at the moves by Pepsi such as acquiring Rockstar and becoming just distributor for Bang away from one of your partners, Anheuser, all this seems to leave more and more holes for distributors in the segment. I guess the question is, is segment activity potentially shifting distribution conversations to larger, more acute deals in the wake of the industry trend?
Excellent, Dave. Thank you for the question. And also, when you look at it, there's a lot of opportunity here, especially what transpired most recently during the quarter and I touched on it briefly in the prepared remarks in regards to Bang! Providing that notification and moving out of an independent network, which comprised mostly Anheuser Busch distributors to 100 percent Pepsi. So, you're already seeing those transitions taking place right now in markets where Bang!
Was self distributing, And we're hearing word over the next really 60 days they'll be making the transition from the other distributors over to Pepsi. So there is a lot of disruption. Where there's disruption, there's opportunity. Switching networks has always been very disruptive for brands. So we are very eager to take advantage of the disruption in the marketplace.
So there has been a lot of changes and even within what's going on within brands when you look at what's taking place with Bang, but also with COVID-nineteen, which has also affected a tremendous amount of channels being 1 in the energy drink category, the convenience channel, has been extremely affected with traffic and also fitness and food service. So there's a lot of changes taking place right now. We feel we're in a good position. We're already up to 100 distributors, and the ones we were talking with and had conversations ongoing in dialogue, it was really a challenge because Bang! Had exclusivity in a lot of contracts that were in place with these distributors.
But now that has opened. We have discussions ongoing, and we feel we're in a really good spot. Some of the distributors that are releasing Bang! Are very excited for the opportunity to work with Celsius, And we think we're like well positioned on the other side of this to capitalize on the health and wellness trends that are here today and not going away.
Great. Now it sounds like it's opened up some things. And you mentioned disruption as the competitor switches major distribution. Alternatively, do you think that Pepsi may add a little bit to be more promotional here with Bang?
I think so. I think you're going to see a lot of activities and promotional activities happening in summer beverage season. We're already talking with many key retailers to be included in those programs. In really the July, August timeframe. Retailers want to get consumers back into store.
They're looking for new innovation. They're looking for special pricing promotions to drive traffic back into retail. And we've been through this whole process with our re pivoting our teams to work on online to partner with our retailers on online activation, customer pickups, those type of things, we feel we've built a really good relationship to be included in some of those programs. As an example, we're working with CBS and Target right now, as well as 711 on some really big off shelf programs to drive additional awareness of Celsius and to take advantage of the opportunities on partnering with these retailers. So you're going to see a lot of pricing opportunities and promotional activity once we head into summer beverage season, which seems to be aligned with many retailers.
But I think that the category overall on pricing remains strong, and we have a premium position in the category that is not going to change. We're driving a premium position as this category continues to grow and evolve for this better for you functional performance energy category that every retailer in the country is looking to expand on and Celsius is a major component of that category.
Fantastic. Great performance in 1Q again. Thank you.
Thank you, David.
Our next question comes from the line of Jeffrey Cohen with Ladenburg Thalmann. Please proceed with your question.
Hi, John and Edwin. How are you?
Excellent, Jeff. Hello.
Hey, so great readout. I'll keep my questions to 4 or 5. So can you talk about the spike in European volume, specifically outside of the Nordics, where are you seeing that tremendous growth from?
Sure. Really, when you look at the European volume, you're seeing that on the full quarter of revenue recognition due to the with the acquisition on the accretive nature. So, we did see good revenue growth within the Nordics. As I mentioned, Sweden was one of within Sweden, Celsius was one of the fastest growing energy drink brands during the quarter and of course to Nielsen. The other markets mainly where the sales are derived from is Norway and Finland.
And keep in mind that market was very challenged during the quarter due to the lockdowns that which took place. So really the growth was pretty much all driven by the Swedish market. The Swedish market has taken a different approach versus other markets and countries around the world. So that's how we're defining much of the growth there.
Got it. And could you talk about the introduction of the Peach Vibe limited edition? And besides online, where is that being sold?
Just announced our Peach 5, our newest flavor, to bring excitement to many retailers, just rolling out right now. We'll have it authorized in many retailers around the country over the next several months as PlanetGram's get reset. Right now, it's available on Amazon and other retailers and soon to be to a fine retailer near you. Perfect.
Got it. And can you talk about the closing of Funk and any update as far as snacks and bars in North America?
Yes, I think the acquisition is going extremely well. We have a really good team over there. We've been working cross functionally within organizations, sales and marketing, a lot of initiatives, a lot of collaboration. And there's further synergistic opportunities as we continue to scale. We're working on renegotiating contracts on warehouses, suppliers, a lot of good things for additional accretion and margin as well as we grow.
We have looked at bringing over the fast protein bar line in North America. Due to the COVID situation, we've delayed that some. We're currently still evaluating that, and we'll have more to share with you in the quarters to come.
Okay, got it. And then lastly, I think for you Edwin, can you talk about the inventory and the inventory build? It looks like your comments were about $5,500,000 in increase. So where does that lie and how does that relate to the number of tanners you're using at least domestically? And is it specific to region or territory or product line?
Yes. Thank you. Very good question. Absolutely, yes. The increase was about $5,000,000 $5,500,000 and yes, mainly here in the U.
S. That translates just to give you some perspective to about 130 days of inventory. And what we did is make sure that we increase our inventories so that if there's any disruption in the supply chain that we're able to address it. So from that perspective, it was something that we planned for strategic move. We wanted to make sure coming into the summer selling season that we had good levels of inventory and obviously not have any disruptions.
So yes, absolutely, it was something that we did knowingly. And then obviously, when you look at inventory levels, you have to look not only at the historic demand, but also plan for the future demand as well.
Perfect. Okay, that does it for me. Great quarter. Nice readout.
Thank you, Jeff. Thank you.
Our next question comes from the line of Jeff Van Sinderen with B. Riley FBR. Please proceed with your question.
Good morning, everyone. Let me add my congratulations on terrific work in Q1. You mentioned Walmart is roughly 50% DSD at this point, I believe. Can you give us more color on what you're seeing at that retailer and maybe touch on converting to more DSDs there? How that is expected to go?
And then maybe give us a sense a latest sense of how your business is trending with Target and where you are with DSDs there?
Yes, absolutely. Thank you, Jeff. We are working with every single one of our key retailers to flip them over and move them over from a wholesaler direct model over to the DSD partners just due to the velocity we're seeing, better in stocks, better placements, better execution. Celsius is just turning at such a high rate. It really needs that additional touch points at retail.
So at Walmart, half of the stores are being serviced by DSD and we're seeing great results there. We're seeing it in coolers in addition to the dry shelves and seeing good rotation and velocity. The other stores that are going through the warehouse, they're not serviced as well. We're seeing out of stocks and poor execution in retail. So we're supplementing that in certain markets with merchandisers, but what we are also doing is working on flipping those over to the DSD as we build out these territories.
So we've been working very closely with the buyers and we feel confident in the back half of this year we'll have more Walmarts really moved over to this preferred route to market. And the same thing with Target. Right now, the Targets in the New York metropolitan market are serviced by Big Geyser. We're seeing great velocities there moving from warehouse over to DSD and we are working with them diligently on flipping over key markets. We already have 5 markets identified where we have coverage.
We are going to be flipping those over in the next few months as we rotate warehouses and we're also working on other key markets especially with the Bang News and our further progression on signing up distributors for our in regards to some big promotional activity that is planned in July with Target. So that will drive additional volume, placements, execution and move allow us to move quicker over to the DSD model, where we're seeing great momentum. Target's a great account for us. We're already up to 5 flavors, and we're looking to be a big player in their energy drink category at Target.
Okay, great. And then I know it's early, but any color you can give us on what you're seeing in some of the regions in the U. S. That are starting to reopen? And then what are you anticipating in your business as more of the country reopens?
With everything going on, it's very uncertain as we talked about. It's hard to say what the future holds. With the current environment as countries open and close and you're seeing the gym channel come back, starting to see some businesses reopen in restaurants in key markets. It's really hard to say, in the current environment. I will say, which we said publicly, that orders in April were up 38%, but it's really a week by week situation.
Many CPG companies and other companies, as you know, are pulling estimates and forecasts, and we don't provide guidance. But we do feel based on initial results in April, we are still maintaining good momentum. What the future holds is to be determined. But we do feel in the overall broader energy drink category, we're in a really good position with everything that's taking place in the macro environment for healthy, better for you functional beverages and what's taking place in the energy category.
Okay. And then just one more follow-up, if I could add to that. Any more color you can give us on how you're evolving marketing plans for the near term and how you're thinking about flexing as plans for the U. S. To reopen?
Yes. I mean, we've really through the Q1, we really reengineered a lot of all the sales and marketing teams to realign them to current opportunities. That's one thing that's great about being a nimble organization. We repositioned our fitness team. We repositioned our food service team to help out in retail during the pantry loading, and they're further working on integration on online integrated programs with our key regional grocery stores, mass market merchants and vitamin specialty stores, which are still open as well.
So a lot of integration. It's going to be a lot of social media, e commerce. I touched on the most recent data point we got where Celsius is the 3rd largest brand on Amazon in the energy drink category. That's an amazing achievement for our team and just shows you the momentum we have. We need to further leverage that and move into other segments as well, continue to drive momentum.
But we're going to continue to provide emotional engagements with our consumers and continue to build out our fan base and our communities, which is so critical and key to our long term success. And then we'll continue to move back into some online activation as the markets permit, being very cautious and safe through the process. But our goal is to help people live a healthy, better lifestyle, and we want to be there to support them.
Okay, terrific. Thanks for taking my questions and continued success.
Thank you, Jeff. Thank you.
Our next question comes from the line of Anthony Vendetti with Maxim Group. Please proceed with your question.
Thanks. I just wanted to follow-up a little bit, John, on the Amazon point you made, number 3, in terms of energy drinks on Amazon. Can you talk about this quarter specifically whether you were you believe you were positively impacted due to COVID-nineteen for this quarter on your total online. If you could just tell us what the growth was online or at Amazon for the quarter?
Yes. Our online thank you, Anthony. The online business has over the years has been a very strong area of growth for Celsius, even going back the last 5, 6 years. If you look at the overall internal online business that we've been able to generate. Yes, there were spikes in our online sales as really shopping patterns shift, But it was great to see that the tide lifted with Celsius at the same velocity rates as some of the other brands and we outpaced the growth in many other brands including Monster and Red Bull.
So the growth has been strong. What was great to see is a lot of brands also we're seeing as some products are an impulse buy. What we've been able to see with really the fitness channel closing, convenience and food service, we saw a lot of volume transition over to other channels. And Celsius is part of a daily routine. I think that's very critical for the opportunity we have here.
We're not just an impulse buy. We're part of a daily lifestyle. That's what we've been building over the last several years. That's what we're continuing to build and that shows you the opportunity we have. Okay.
And then just one last follow-up on the COVID-nineteen. I mean, obviously, there's been some positive benefits that you've seen from that. Can you talk a little bit about the just the positives and negatives? And if you're prepared, in terms of down the road, any supply chain interruption, what sort of contingency plans do you have if it gets to supply chain gets constrained at some point?
Yes. I mean, positive, I don't think there's really many positives. This is a terrible situation we're all in that we need to help everyone. It's heartbreaking what's going on with small businesses and taking place within communities. We pivoted and pivoted as quickly as we can where we had samplings and demos that we were doing that we weren't able to do.
So we pivoted and supported the heroes around the country where Celsius has given out thousands of cases to over 4 50 hospitals around the country. We pivoted to help consumers and to help small businesses and trainers, personal trainers to give them a platform to Sweat with Celsius campaigns and repositioned our sales organizations, As Edwin mentioned on inventory, starting in January, we really have set contingency plans up in each department going from accounting to operations to sales to marketing and constantly reviewing those and altering those as we're going through this process. So contingency plans in place, we've implemented, we've increased inventories throughout the whole quarter. We've also placed blanket purchase orders for further out periods than we've ever had before to make sure we have sufficient supply. We expanded the co packer network, so we have availability at multiple co packers in case there is a situation where a co packer had to go down for several weeks, which we've heard stories about those.
There's just been a lot that the company has done in the organization as we continue to pivot and shift through the current environment. But I do think the company and the employees have reacted really well and been very nimble. Has it been stressful for many? Absolutely. Transitioning many to work from home, it went seamlessly, but it has been difficult.
It's not as seamless as working as a cohesive organization as we've done. But in this considering some circumstances and the results the team has been able to put up, they've done an amazing job.
Thanks. That was very helpful. Appreciate it.
Thank you, Eddie.
Our next question is a follow-up question from the line of David Bain with Roth Capital Partners. Please proceed with your question.
Great. Thanks. If I could just quickly shift back to the distributor relationships and industry dynamics. It just seems like if it seems like the options for these distributors are becoming more limited, finding a functional energy category company with breadth and growth anywhere near like a Celsius. Just looking at the historical partnerships though, we found that a lot of them a lot of the distributors would look to take a position in the company itself.
Just any kind of thoughts on these types of partnership structures? And then also any considerations on aligning more with 1 major player versus more bifurcated or fragmented distribution structure?
Thank you, Dave. There's a lot of relationships out there. Working on a variety of them. We're going to do what's best for our shareholders and best for the organization and best for the company for Celsius to drive to number 1. That's our goal.
We're reviewing a variety of opportunities. We're looking at distributors, making sure with and aligned with the best distributor possible for that market to drive the best velocity and opportunity. So not going to get into specifics on contract negotiations with given distributors, but we are very much aligned with shareholders' interest. I'm going to do what's best to put Celsius in the best position possible as we continue to maximize the opportunity we have at hand.
Understood. Okay. Thank you very much.
Our next question comes from the line of sean Boyd with Nexmart Capital. Please proceed with your question.
Thanks for taking the question. Can you hear me okay?
Yes, we can, Sean.
Great. Real quick, if you can just help us a little bit and forgive me if this is a fairly naive question, but what percentage of your sales are from bricks and mortar retail versus online right now?
Historically, we used to disclose that information. To be quite honest with you, it's a little fragmented because many of our retail partners, as you know, are all offering online services. So we've expanded when you look at online, we're on walmart.com, we're on amazon.com, we're on bodybuilding.com, vitaminshoppe.com. There's many, many dotcom businesses out there. We have a team dedicated to leveraging our retail partners through pickup services, we're leveraging Instacart.
There's so many different mediums now to drive online purchases and home delivery I don't want to take out one customer if you're calling online Amazon or walmart.com. We do not sell direct. We partner with our retail partners on our online business. So their online business is our online business. So specifically, I can't really answer that question because it is a broader component.
Okay. I hear you on that. Let me go to the heart of this and not as in thinking about the impact of you flipping over to the DSDs. Maybe another way to come at it would be what percentage of your retail doors are currently serviced by DSDs? You've talked about the number in the past and the number today, I think you've leased here over 100.
But if you can help us just sort of how far are we on this shift right now and how quickly would it change say over the next 12 to 24 months?
Yes. I mean right now we're at at the end of the year, we announced we're in roughly approximately 65,000 locations in North America. And today, less than 10% of those doors are serviced by DSD. So the opportunity is massive. The key is all about covering this particular DMAs of the warehouses that are serviced by these key accounts.
And that's what we've been integrating and working on. And many of these retailers will be flipping over in the back half of this year to this preferred method. But I would say approximately right now, you're probably looking at about 10% with DST coverage.
Okay, very helpful. That 40% lift that you commented on with the stores in New York, has that been consistent across other geographic markets?
It has. It has. Actually, certain areas has been even higher. So probably the 40% lift versus going direct to these key accounts seems like a good benchmark on top of the 30% growth rate we've been seeing in existing accounts. So there is a great opportunity by having the DSD coverage because you're getting that salesperson in the store on a frequent rotation to make sure the product is in stock, properly priced and is available and taking advantage of additional points of disruption in a given outlet.
And it's all about placements and trade activation.
Really good to hear. Last one from me. Your comment about April orders up 38% year over year. Given that we're now in an environment where we're starting to see additional states with reopening plans and we understand it's going to be gradual, but as we move forward here, is it fair to assume that is a low mark for the month? I know that's just the 1st month, but would you is it fair to assume we continue we see those monthly
sales growing from here?
Yes. I'm not going to talk about future that I don't know. I mean, there's a lot of questions there. How quickly does traffic return to normal in some of these channels? So I can't really comment on that.
Okay. Congrats on the quarter. Thank you.
Excellent. Thank you. Thank you.
There are no further questions in the queue. I'd like to hand the call back to management for closing remarks.
Thank you. On behalf of the company, we'd like to thank everyone for their continued interest. Our results demonstrates our products are gaining considerable momentum as we are capitalizing on today's health and wellness trends. We are building upon our core and leveraging opportunities and deploying best practices. We have a winning portfolio and strategy in a rapidly growing market that consumers want.
Our mission is to get CELSIUS to more consumers profitably. I'm very proud of our dedicated team as with South Bend, our tremendous achievements and significant opportunities we see ahead would not be possible. In addition, I want to thank all of our investors for their continued support and confidence in our team. We wish everyone well. Please stay safe in this current environment.
Thank you for your interest and have a great day.
Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.