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What changed in NATIONAL BEVERAGE CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of NATIONAL BEVERAGE CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+128 added−97 removedSource: 10-K (2024-06-26) vs 10-K (2023-06-28)

Top changes in NATIONAL BEVERAGE CORP's 2024 10-K

128 paragraphs added · 97 removed · 79 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeOther successful LaCroix additions include Hi-Biscus, a unique flavor that adds the delicate essence of the hibiscus flower to sparkling water; the enticing savor of LimonCello, which instantly transports fans to the Italian Riviera; and the refreshing taste of Pastèque, which captures the lusciousness of a sweet picnic watermelon.
Biggest changeMojito joins the most recent addition of Cherry Blossom – a botanical twist of sweet and just a ‘kiss’ of tart. 2 Table of Contents Other successful LaCroix recent additions include Beach Plum with its delectable coolness of the luscious fruit native to the east coast of the U.S; Black Razzberry’s decadent, smooth and irresistible fruit flavor; the sweet tropical delicacy of Guava São Paulo; Hi-Biscus, a unique flavor that adds the delicate essence of the hibiscus flower to sparkling water; the enticing savor of LimonCello, which instantly transports fans to the Italian Riviera; and the refreshing taste of Pastèque, which captures the lusciousness of a sweet picnic watermelon.
Proprietary flavors and our naturally-essenced beverages are developed and tested in-house and made commercially available only after extensive concept and sensory evaluation. Our variety of distinctive flavors provides us a unique advantage with today’s consumers who demand variety and refreshing beverage alternatives.
Proprietary flavors and our naturally-essenced beverages are developed and tested in-house and made commercially available only after extensive concept and sensory evaluation. Our variety of distinctive flavors provides us with a unique advantage with today’s consumers who demand variety and refreshing beverage alternatives.
Also, our Company-owned direct-store delivery fleet distributes products to schools and food-service locations. 6 Table of Contents Our take-home, convenience and food-service operations use vending machines and glass-door coolers as marketing and promotional tools for our brands. We provide vending machines and coolers on a placement or purchase basis to our customers.
Also, our Company-owned direct store delivery fleet distributes products to schools and food-service locations. 5 Table of Contents Our take-home, convenience and food-service operations use vending machines and glass-door coolers as marketing and promotional tools for our brands. We provide vending machines and coolers on a placement or purchase basis to our customers.
Creative Innovations – Building on a rich tradition of flavor and brand innovation with more than a 130-year history of development with iconic brands such as Shasta® and Faygo®, we have extended our flavor and essence leadership and technical expertise to the sparkling water category.
Creative Innovations – Building on a rich tradition of flavor and brand innovation with more than a 135- year history of development with iconic brands such as Shasta® and Faygo®, we have extended our flavor and essence leadership and technical expertise to the sparkling water category.
By consolidating the purchasing function for our production facilities, we believe we procure more competitive arrangements with our suppliers, thereby enhancing our ability to compete as an efficient producer of beverages. 7 Table of Contents The products we produce and sell are made from various materials including aluminum cans, glass and plastic bottles, water, carbon dioxide, juice and flavor concentrates, sweeteners, cartons and closures.
By consolidating the purchasing function for our production facilities, we believe we procure more competitive arrangements with our suppliers, thereby enhancing our ability to compete as an efficient producer of beverages. The products we produce and sell are made from various materials including aluminum cans, glass and plastic bottles, water, carbon dioxide, juice and flavor concentrates, sweeteners, cartons and closures.
We are unable to predict whether such legislation will be enacted but believe its enactment would not have a material adverse impact on our business, financial condition or results of operations. All of our facilities in the United States are subject to federal, state and local environmental laws and regulations.
We are unable to predict whether such legislation will be enacted but believe its enactment would not have a material adverse impact on our business, financial condition or results of operations. 7 Table of Contents All of our facilities in the United States are subject to federal, state and local environmental laws and regulations.
In addition, our Code of Ethics is available on our website. The information on the Company’s website is not part of this Annual Report on Form 10-K or any other report that we file with, or furnish to, the Securities and Exchange Commission.
In addition, our Code of Ethics is available on our website. The information on the Company’s website is not part of this Annual Report on Form 10-K or any other report that we file with, or furnish to, the Securities and Exchange Commission. 8 Table of Contents
Additionally, we maintain and enhance consumer brand recognition and loyalty through a combination of participation in regional events, special event marketing, endorsements, consumer coupon distribution and product sampling. We also offer numerous promotional programs to retail customers, including cooperative advertising support, ‘Brand ED ’ ambassadors, in-store promotional activities and other incentives.
Additionally, we maintain and enhance consumer brand recognition and loyalty through a combination of participation in regional events, special event marketing, endorsements, consumer coupon distribution and product sampling. We also offer numerous promotional programs to retail customers, including cooperative advertising support, ‘BrandED’ ambassadors, in-store promotional activities and other incentives.
Certain of our products are also distributed on a limited basis in other countries and options to expand distribution to other regions are being considered. National Beverage Corp. is incorporated in Delaware and began trading as a public company on the NASDAQ Stock Market in 1991.
Presently, our primary market focus is the United States and Canada. Certain of our products are also distributed on a limited basis in other countries and options to expand distribution to other regions are being considered. National Beverage Corp. is incorporated in Delaware and began trading as a public company on the NASDAQ Stock Market in 1991.
GOVERNMENTAL REGULATION The production, distribution and sale of our products in the United States are subject to the Federal Food, Drug and Cosmetic Act; the Dietary Supplement Health and Education Act of 1994; the Occupational Safety and Health Act; various environmental statutes; and various other federal, state and local statutes regulating the production, transportation, sale, safety, advertising, labeling and ingredients of such products.
GOVERNMENTAL REGULATION The production, distribution and sale of our products in the United States are subject to the Federal Food, Drug and Cosmetic Act; the Dietary Supplement Health and Education Act of 1994; the Occupational Safety and Health Act; the Clean Air Act, the Clean Water Act; the Comprehensive Environmental Response, Compensation and Liability Act; the Resource Conservation and Recovery Act; various environmental statutes; and various other federal, state and local statutes regulating the production, transportation, sale, safety, advertising, labeling and ingredients of such products.
Several competitors, including those that dominate the beverage industry, such as Nestlé S.A., PepsiCo and The Coca-Cola Company, have greater financial resources than we have and aggressive promotion of their products may adversely affect sales of our brands. 8 Table of Contents TRADEMARKS We own numerous trademarks for our brands that are significant to our business.
Several competitors, including those that dominate the beverage industry, such as Nestlé S.A., PepsiCo and The Coca-Cola Company, have greater financial resources than we have and aggressive promotion of their products may adversely affect sales of our brands.
Each of our facilities has programs in place designed to minimize the use of water, energy, and other natural resources. 10 Table of Contents AVAILABLE INFORMATION Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports are available free of charge on our website at www.nationalbeverage.com as soon as reasonably practicable after such reports are electronically filed with the Securities and Exchange Commission.
AVAILABLE INFORMATION Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports are available free of charge on our website at www.nationalbeverage.com as soon as reasonably practicable after such reports are electronically filed with the Securities and Exchange Commission.
Packaged in sleek 12 oz. tall cans, popular flavors include Cerise Limón, which pairs sweet cherry with tangy lime for a tasteful infusion that tickles the senses; Piña Fraise, an aromatic combination of pineapple and ripe strawberries that creates a tropical blend delight; and Múre Pepino, which combines sweet and sour blackberry notes with crisp cucumber to create a sensory and taste sensation. 3 Table of Contents Additional LaCroix flavors are in development that will continue to feature unique packaging and flavor concepts designed to capitalize on LaCroix brand loyalty and popularity of the sparkling water category.
Packaged in sleek 12 oz. tall cans, popular flavors include Cerise Limón, which pairs sweet cherry with tangy lime for a tasteful infusion that tickles the senses; Piña Fraise, an aromatic combination of pineapple and ripe strawberries that creates a tropical blend delight; and Múre Pepino, which combines sweet and sour blackberry notes with crisp cucumber to create a sensory and taste sensation.
We intend to continue to maintain all registrations of our significant trademarks and use the trademarks in the operation of our businesses.
TRADEMARKS We own numerous trademarks for our brands that are significant to our business. We intend to continue to maintain all registrations of our significant trademarks and use the trademarks in the operation of our businesses.
PRODUCTION We believe the innovative and controlled vertical integration of our production facilities provides an advantage over certain of our competitors that rely on independent third-party bottlers to manufacture and market their products.
Each facility is generally equipped to produce both canned and bottled beverage products in a variety of package sizes. We believe the innovative and controlled vertical integration of our production facilities provides an advantage over certain of our competitors that rely on independent third-party bottlers to manufacture and market their products.
Since we control all production, distribution and marketing of our brands, we believe we can more effectively manage quality control and consumer appeal while responding quickly to changing market conditions. 5 Table of Contents DISTRIBUTION To service a diverse customer base that includes numerous national retailers, as well as thousands of smaller “up-and-down-the-street” accounts, we utilize a hybrid distribution system to deliver our products through three primary distribution channels: take-home, convenience and food-service.
DISTRIBUTION To service a diverse customer base that includes numerous national retailers, as well as thousands of smaller “up-and-down-the-street” accounts, we utilize a hybrid distribution system to deliver our products through three primary distribution channels: take-home, convenience and food-service.
Our portfolio of Power+ Brands includes LaCroix®, LaCroix Cúrate®, and LaCroix NiCola® sparkling water products; Clear Fruit®; Rip It® energy drinks and shots; and Everfresh®, Everfresh Premier Varietals™ and Mr. Pure® 100% juice and juice-based products.
Our portfolio of Power+ Brands includes LaCroix®, LaCroix Cúrate® and LaCroix NiCola® sparkling water products; Clear Fruit®; Rip It® energy drinks and shots; and Everfresh®, Everfresh Premier Varietals™ and Mr. Pure® 100% juice and juice- based products. Additionally, we produce and distribute carbonated soft drinks (“CSDs”) including Shasta® and Faygo®, iconic brands whose consumer loyalty spans more than 100 years.
Everfresh Premier Varietals is a premium line of apple juice derived from a variety of apples specific to the taste of the varietal, such as Granny Smith, McIntosh, Honey Crisp, Golden Delicious, Fuji and Pink Lady. Clear Fruit is a crisp, clear, non-carbonated water beverage enhanced with fruit flavors.
Everfresh Premier Varietals, a unique theme from Everfresh, is positioned as a stand-alone brand for display in the produce section of supermarkets. Everfresh Premier Varietals is a premium line of apple juice derived from a variety of apples specific to the taste of the varietal, such as Granny Smith, McIntosh, Honey Crisp, Golden Delicious, Fuji and Pink Lady.
LaCroix’s dynamic ‘theme’ LaCroix Cúrate® (‘Cure Yourself’) celebrates French sophistication with Spanish zest and bold flavor pairings.
These innovative new varieties are part of the LaCroix family of 30 refreshingly innocent flavors. LaCroix’s dynamic ‘theme’ LaCroix Cúrate® (‘Cure Yourself’) celebrates French sophistication with Spanish zest and bold flavor pairings.
Points of differentiation include the following: Healthy Transformation – We focus on developing and delighting consumers with healthier beverages in response to the global shift in consumer buying habits and lifestyles. We believe our portfolio satisfies the preferences of a diverse mix of consumers including ‘crossover consumers’ – a growing group desiring healthier alternatives to artificially sweetened or high-calorie beverages.
Points of differentiation include the following: Healthy Transformation – We focus on developing and delighting consumers with healthier beverages in response to the global shift in consumer buying habits and lifestyles.
Our compensation programs are designed to ensure we attract and retain talent while maintaining alignment with market compensation. We utilize a mix of short-term incentive programs throughout the organization and provide long-term incentive programs to more senior employees generally through stock-based compensation programs.
We utilize a mix of short term incentive programs throughout the organization and provide long-term incentive programs to more senior employees generally through stock-based compensation programs. We offer competitive employee benefits that are effective in attracting and retaining talent and are designed to support the physical, mental and financial health of our employees.
Our operations personnel, supplemented by risk management professionals, review all aspects of employee tasks and work environment to minimize risk. We strive to achieve an injury-free work environment in our operations. Key to these efforts are data analysis and preventative actions.
Our employee benefits program includes comprehensive health, dental, life and disability and profit-sharing benefits. Our operating philosophy emphasizes the health and safety of our employees. Our operations personnel, supplemented by risk management professionals, review all aspects of employee tasks and work environment to minimize risk. We strive to achieve an injury-free work environment in our operations.
More than 80% of our products are in aluminum cans, which generally contain approximately 73% recycled material.
More than 80% of our products are in aluminum cans, which generally contain approximately 73% recycled material. Each of our facilities has programs in place designed to minimize the use of water, energy and other natural resources.
We also believe the design of our packages and the overall optical effect of their placement on the shelf (“shelf marketing”) has become more important as millennials and younger generations become increasingly influential consumers, and are now influencing baby boomers and older generations. 1 Table of Contents Presently, our primary market focus is the United States and Canada.
We also believe the design of our packages and the overall optical effect of their placement on the shelf (“shelf marketing”) has become more important as millennials and younger generations become increasingly influential consumers and are now influencing baby boomers and older generations. 1 Table of Contents Creative Dynamics – In a beverage industry dominated by the “cola giants”, we pride ourselves on being able to respond faster and more creatively to consumer trends than competitors burdened by legacy production and distribution complexity and costs.
Clear Fruit is available in 14 delicious flavors, including consumer favorites Cherry Blast, Strawberry Watermelon, and Fruit Punch. Clear Fruit is available in 20-ounce and 16.9-ounce bottles with consumer-favored sports caps.
Clear Fruit Clear Fruit is a crisp, clear, non-carbonated water beverage enhanced with fruit flavors. Clear Fruit is available in 13 delicious flavors, including consumer favorites Cherry Blast, Strawberry Watermelon and Fruit Punch.
In recent years, we reformulated many of our brands to reduce caloric content while still preserving their time-tested flavor profiles. Our brands, optically and ingredient-wise, are continually evolving. We always strive to make all our drinks healthier while maintaining their iconic taste profiles.
In addition, products produced locally often generate retailer- sponsored promotional activities and receive media exposure through community activities rather than costly national advertising. In recent years, we reformulated many of our brands to reduce caloric content while still preserving their time-tested flavor profiles. Our brands, optically and ingredient-wise, are continually evolving.
Additionally, we use derivative financial instruments to partially mitigate our exposure to changes in certain raw material costs. SEASONALITY COMPETITION While LaCroix Sparkling Water is the brand of choice as the number one premium domestic sparkling water throughout the United States, the beverage industry is highly competitive and our competitive position may vary by market area.
Beverage sales are seasonal with higher volume realized during summer months when outdoor activities are more prevalent. COMPETITION While LaCroix Sparkling Water is the brand of choice as the number one premium domestic sparkling water throughout the United States, the beverage industry is highly competitive and our competitive position may vary by market area.
We believe vending and cooler equipment expands on-site visual trial, thereby increasing sales and enhancing brand awareness. SALES AND MARKETING Our marketing emphasizes programs designed to reach consumers directly through innovative digital marketing, digital social marketing, social media engagement, sponsorships and creative content.
We believe this focus allows our sales group to provide high level, responsive service and support to our customers and markets. Our marketing emphasizes programs designed to reach consumers directly through innovative digital marketing, digital social marketing, social media engagement, sponsorships and creative content.
Compliance with these provisions has not had any material adverse effect on our financial or competitive position.
Compliance with these provisions has not had any material adverse effect on our financial or competitive position. We believe our current practices and procedures for the control and disposition of toxic or hazardous substances comply in all material respects with applicable law.
In addition, the majority of our products are delivered through the warehouse distribution system which provides more efficient and lower greenhouse gas emissions than direct-store delivery systems. Water is critical to our business, and we periodically conduct water quality assessments on a variety of measurements. All of our packaging is recyclable and we continually focus on reducing packaging content.
All our beverage products are produced in the U.S., providing thousands of jobs in local communities and boasting a lower carbon footprint than imported brands. The majority of our products are delivered through the warehouse distribution system which provides more efficient and lower greenhouse gas emissions than direct store delivery systems.
Rip It 4 Table of Contents Carbonated Soft Drinks – Many of our carbonated soft drink brands enjoy a regional identification that we believe fosters long-term consumer loyalty and makes them more competitive as a consumer choice. In addition, products produced locally often generate retailer-sponsored promotional activities and receive media exposure through community activities rather than costly national advertising.
Faygo is celebrated in the Midwest as the “The One True Pop.” Many of our carbonated soft drink brands enjoy a regional identification that we believe fosters long-term consumer loyalty and makes them more competitive as a consumer choice.
These collective bargaining agreements generally address working conditions, as well as wage rates and benefits, and expire over varying terms over the next several years. We believe these agreements can be renegotiated on terms satisfactory to us as they expire and we believe we maintain good relationships with our employees and their representative organizations.
We believe these agreements can be renegotiated on terms satisfactory to us as they expire and we believe we maintain good relationships with our employees and their representative organizations. We support a culture of diversity and inclusion that mirrors the markets we serve. We take a comprehensive view of diversity and inclusion across different races, ethnicities, religions and gender identity.
We measure and benchmark lost-time incident rate, a reliable indication of total recordable injuries rate and severity, and use a risk- reduction process that thoroughly analyzes injuries and near misses. During the COVID-19 pandemic, we took comprehensive measures to safeguard the well-being of our employees. These measures included enhanced sanitation procedures, physical distancing, and other health protocols.
Key to these efforts are data analysis and preventative actions. We measure and benchmark lost-time incident rate, a reliable indication of total recordable injuries rate and severity and use a risk- reduction process that thoroughly analyzes injuries and near misses. SUSTAINABILITY National Beverage Corp. adheres to responsible business practices and continually strives to improve the sustainability of its operations.
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Additionally, we produce and distribute carbonated soft drinks (“CSDs”) including Shasta® and Faygo®, iconic brands whose consumer loyalty spans more than 130 years. 2 Table of Contents Power+ Brands – LaCroix Continual flavor and packaging innovations for LaCroix in recent years include the unique flavor of Cherry Blossom – a botanical twist of sweet and just a ‘kiss’ of tart.
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We believe our portfolio satisfies the preferences of a diverse mix of consumers including ‘crossover consumers’ – a growing group desiring healthier alternatives to artificially sweetened or high- calorie beverages.
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The distinctive taste and stunning packaging of Cherry Blossom conveys the ‘Dazzling Taste of Spring!’ The launch of Cherry Blossom featured an integrated effort involving social and outdoor media, spot radio, consumer sampling and attractive retail in-store displays.
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The ability to identify consumer trends and create new market-leading concepts defines our new product development model. Speed to market with the appropriate concept, unique flavor creation and trend forward ‘better-for-you’ ingredients continues to be our goal. Internal development teams are responsible for concept creation, packaging and design, which allow for rapid ‘go to market’ timing and reduced development costs.
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In June 2022, PEOPLE Magazine recognized LaCroix Cherry Blossom as the winner of the Flavored Water Category in the PEOPLE’s Food Awards 2022. PEOPLE described Cherry Blossom as “spring in a can…with fruity, lightly floral notes.” Cherry Blossom joined the innovative trio of Beach Plum, Black Razzberry and Guava São Paulo launched in the fourth quarter of fiscal year 2021.
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We strive to provide retailers and consumers with the most innovative flavors and packaging in the industry. Two of our LaCroix distinctive variety packs, as well as Zero Sugar Shasta and three new flavors of Rip It, were recently honored as top recipients of the International Davey Awards for creativity.
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Beach Plum excites the imagination and inspires dreams of summer with the delectable coolness of the luscious fruit native to the east coast of the U.S.; the sweet twist of Black Razzberry makes taste buds sing with decadent, smooth and irresistible fruit flavor; and consumers savor the sweet tropical delicacy and vibrant essence of Guava São Paulo.
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POWER+ BRANDS – LaCroix LaCroix Sparkling Water, our most significant brand, has uniquely redefined the Sparkling Water category that is rapidly becoming the alternative to traditional carbonated soda. With zero calories, zero sweeteners and zero sodium, LaCroix leads the premium domestic sparkling water category.
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Everfresh and Mr. Pure Everfresh Premier Varietals, a unique theme from Everfresh, is positioned as a stand-alone brand for display in the produce section of supermarkets.
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Naturally-essenced, LaCroix has gained the support of national retailers in multiple channels, including mass-merchandisers, club stores, drug stores, mainstream supermarkets and natural and specialty food retailers. In 2024, Newsweek once again named LaCroix as one of "The Most Trusted Brands in America” based on a survey of U.S. shoppers.
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We believe our current practices and procedures for the control and disposition of toxic or hazardous substances comply in all material respects with applicable law. 9 Table of Contents HUMAN CAPITAL As of April 29, 2023, we employed approximately 1,593 people, of which 374 are covered by collective bargaining agreements.
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Additionally, the classic flavor of LaCroix Lime claimed the top spot in the sparkling water category in the 2024 AllRecipes Golden Cart Awards. Renowned for their culinary expertise, the All Recipes' Allstars praised the fresh flavor of LaCroix Lime as “super thirst-quenching”. Continual flavor and packaging innovations for LaCroix in recent years include the newest LaCroix flavor, Mojito.
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We support a culture of diversity and inclusion that mirrors the markets we serve. We take a comprehensive view of diversity and inclusion across different races, ethnicities, religions and expressions of gender and sexual identity. Approximately 62 percent and 24 percent of our employee base identify as persons of color or female, respectively.
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Mojito, launched in the third quarter of the fiscal year ended April 27, 2024 (“Fiscal 2024”), brings the sensory feel of paradise to consumers.
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We offer competitive employee benefits that are effective in attracting and retaining talent and are designed to support the physical, mental and financial health of our employees. Our employee benefits program includes comprehensive health, dental, life and disability, and profit-sharing benefits. Our operating philosophy emphasizes the health and safety of our employees.
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Additional LaCroix flavors are in development that will continue to feature unique packaging and flavor concepts designed to capitalize on LaCroix brand loyalty and popularity of the sparkling water category. Everfresh and Mr. Pure Everfresh and Mr.
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We continue to monitor the health and safety of our work force. SUSTAINABILITY National Beverage Corp. is dedicated to sustainable operations and responsible business initiatives. All our beverage products are produced in the U.S., providing thousands of jobs in local communities and boasting a lower carbon footprint than imported brands.
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Pure 100% juice and juice drinks are available in a variety of flavors, from such classics as Orange, Cranberry and flavored lemonades to exotics that include Papaya, Pineapple Mango, Peach Watermelon and Island Punch. The brands’ signature package is a hot-filled, 16 oz. glass bottle designed for single-serve consumption.
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Clear Fruit is available in 20-ounce and 16.9-ounce bottles with consumer-favored sports caps. 3 Table of Contents Rip It RIP It Energy Fuel offers ‘Flavors for All!’ with 19 unique flavors and four sugar-free options.
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In addition to all-time consumer favorites, Tribute, Citrus X, Cherry Lime and Power, newly launched ‘ Re-Energizzed ’ Rip It flavors include Skr’eech In with its luscious strawberry-peach taste and the exotic and mysterious flavor of Dragon Fire. These newest additions join pineapple YOLO; watermelon-flavored Melon Hi; and the sweet and wild cotton candy experience of Can’D Man.
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Building on the flavor tradition of original Rip It, a 2 oz. sugar- free shot version in six flavors is marketed in displayable package configurations. RIP It proudly supports military and first responder heroes at home and abroad. Carbonated Soft Drinks – Currently celebrating its 135 th Anniversary, Shasta is recognized as a bottling industry pioneer and innovator.
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Shasta features multiple flavors and has earned consumer loyalty by delivering value and convenience with unique taste. In the first quarter of Fiscal Year 2024, Shasta launched three all-time consumer favorites reformulated with Zero Sugar — Shasta Zero Sugar Tiki Punch, Zero Sugar California Dreamin’ and Zero Sugar Mountain Rush.
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Additional Zero Sugar Shasta flavors will be on shelves late Summer 2024. With more than 135 years of brand history, Faygo products include numerous unique flavors such as Red Pop, Moon Mist, Cotton Candy and Rock’n’Rye.
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We always strive to make all our drinks healthier while maintaining their iconic taste profiles. 4 Table of Contents PRODUCTION Our philosophy emphasizes vertical integration; our production model integrates the procurement of raw materials and crafting flavors and concentrates with the production of finished products.
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Our twelve strategically located production facilities are near major metropolitan markets across the continental United States. The locations of our facilities enable us to efficiently produce and distribute beverages to substantially all geographic markets in the United States, including the top 25 metropolitan statistical areas.
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Since we control all production, distribution and marketing of our brands, we believe we can more effectively manage quality control and consumer appeal while responding quickly to changing market conditions. We craft a substantial portion of our flavors and concentrates.
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By controlling our own formulas throughout our bottling network, we are able to produce beverages in accordance with uniform quality standards while innovating flavors to meet changing consumer preferences. We believe the combination of a Company-owned bottling network, together with uniform standards for packaging, formulations and customer service, provides us with a strategic advantage in servicing national retailers and mass-merchandisers.
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We also maintain research and development laboratories at multiple locations. These laboratories continually test products for compliance with our strict quality control standards as well as conduct research for new products and flavors.
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The take-home distribution channel consists of national and regional grocery stores, club stores, mass- merchandisers, wholesalers, e-commerce stores, drug stores and dollar stores. We distribute our products to this channel primarily through the warehouse distribution system and, to a lesser extent, the direct-store delivery system.
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We believe vending and cooler equipment expands on site visual trial, thereby increasing sales and enhancing brand awareness. SALES AND MARKETING We sell and market our products through an internal sales force as well as specialized broker networks. Our sales force is organized to serve a specific market, focusing on one or more geographic territories, distribution channels or product lines.
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Additionally, we use derivative financial instruments to partially mitigate our exposure to changes in certain raw material costs. 6 Table of Contents SEASONALITY Our operating results are affected by numerous factors, including fluctuations in costs of raw materials, holiday and seasonal programming and weather conditions.
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Competitive factors in the beverage industry include price and promotional activity, advertising and marketing programs, point-of-sale merchandising, retail space management, customer service, product differentiation, packaging innovations and distribution methods. We believe our Company differentiates itself through novel innovation, key brand recognition, focused social media, innovative flavor variety, attractive packaging, efficient distribution methods and, for some product lines, value pricing.
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HUMAN CAPITAL As of April 27, 2024, we employed approximately 1,559 people, of which 392 are covered by collective bargaining agreements. These collective bargaining agreements generally address working conditions, as well as wage rates and benefits, and expire over varying terms over the next several years.
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Approximately 62 percent and 24 percent of our employee base identify as persons of color or female, respectively. Our compensation programs are designed to ensure we attract and retain talent while maintaining alignment with market compensation.
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Additionally, we are undertaking measures to reduce our carbon footprint which include transitioning from LP gas to electric powered forklifts and purchasing electricity from renewable sources. Water is critical to our business and we periodically conduct water quality assessments on a variety of measurements. All of our packaging is recyclable and we continually focus on reducing packaging content.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeA prolonged labor shortage or inflation in labor costs could adversely impact our financial results. Unfavorable weather conditions. Unfavorable weather conditions could have an adverse impact on our revenue and profitability. Unusually cold or rainy weather may temporarily reduce demand for our products and contribute to lower sales, which could adversely affect our profitability for such periods.
Biggest changeA prolonged labor shortage or inflation in labor costs could adversely impact our financial results. 9 Table of Contents Unfavorable weather conditions, changing weather patterns and natural disasters Unfavorable weather conditions in the geographic regions in which the Company or its suppliers operate could have an adverse impact on our revenue and profitability.
Our inability to adapt to customer requirements could lead to a loss of business and adversely affect our financial position. Raw materials and energy. The production of our products is dependent on certain raw materials, including aluminum, resin, corn, linerboard, water and fruit juice.
Our inability to adapt to customer requirements could lead to a loss of business and adversely affect our financial position. Raw materials and energy sources. The production of our products is dependent on certain raw materials, including aluminum, resin, corn, linerboard, water and fruit juice.
Our profitability is affected by the cost of employee wages as well as medical and other benefits provided to employees, including employees covered under collective bargaining agreements and multi-employer pension plans. Competition in the labor marketplace for qualified employees has led to increased costs, such as higher wages and benefit costs in order to recruit and retain employees.
Our profitability is affected by the cost of employee wages as well as health insurance and other benefits provided to employees, including employees covered under collective bargaining agreements and multi-employer pension plans. Competition in the labor marketplace for qualified employees has led to increased costs, such as higher wages and benefit costs in order to recruit and retain employees.
If we lose key personnel or are unable to recruit qualified personnel, our operations and ability to manage our business may be adversely affected. Dependence on information technology and third-party service providers. We use information technology and third-party service providers to support our business processes and activities.
If we lose key personnel or are unable to recruit qualified personnel, our operations and ability to manage our business may be adversely affected. Future cyber incidents and dependence on information technology and third-party service providers.
Prolonged drought conditions in the geographic regions in which we do business could lead to restrictions on the use of water, which could adversely affect our ability to produce and distribute products. Dependence on key personnel.
Unusually cold or rainy weather may temporarily reduce demand for our products and contribute to lower sales, which could adversely affect our profitability for such periods. Prolonged drought conditions in the geographic regions in which we do business could lead to restrictions on the use of water, which could adversely affect our ability to produce and distribute products.
In addition, various governmental agencies have enacted or are considering changes in corporate tax laws as well as additional taxes on soft drinks and other sweetened beverages. Compliance with or changes in existing laws or regulations could require material expenses and negatively affect our financial position. Sustained increases in the cost of employee wages and benefits.
In addition, various governmental agencies have enacted or are considering changes in corporate tax laws as well as additional taxes on soft drinks and other sweetened beverages.
If raw materials or energy costs increase, or their availability is limited, our financial position could be adversely affected. 11 Table of Contents Governmental regulation. Our business and properties are subject to various federal, state and local laws and regulations, including those governing the production, packaging, quality, labeling and distribution of beverage products.
Our business and properties are subject to various federal, state and local laws and regulations, including those governing the production, packaging, quality, labeling and distribution of beverage products and those governing environmental laws and regulations.
We may be limited in our ability to pass these increases on to our customers or may incur a loss in sales volume to the extent price increases are taken. In addition, strikes, weather conditions, governmental controls, tariffs, national emergencies, natural disasters, supply shortages or other events could affect our continued supply and cost of raw materials and energy.
We may be limited in our ability to pass these price increases on to our customers or may incur a loss in sales volume to the extent we increase prices.
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Continuity of business applications and services may in the future be disrupted by events such as infection by viruses or malware or other cybersecurity breaches or attacks; issues with systems’ maintenance or security; power outages; hardware or software failures; telecommunication failures; natural disasters; and other catastrophic occurrences.
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Strikes, weather conditions (including conditions caused by climate change), governmental controls, tariffs, national emergencies, natural disasters, supply shortages or other events could also affect our continued supply and cost of raw materials and energy. If raw materials or energy costs increase, or their availability is limited, our financial position could be adversely affected. Governmental regulation.
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If our controls, disaster recovery and business continuity plans or those of our third party providers do not effectively respond to or resolve the issues related to any such disruptions in a timely manner, our sales, financial condition and results of operations may be adversely affected.
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Continuing concern over environmental, social and governance matters, including climate change, is expected to continue to result in new or increased legal and regulatory requirements to reduce emissions to mitigate the potential effects of greenhouse gases, to limit or impose additional costs on commercial water use due to local water scarcity concerns or to expand mandatory reporting of certain environmental, social and governance metrics.
Added
Compliance with or future changes in existing laws or regulations could require material expenses and or capital expenditures and negatively affect our financial position. Sustained increases in the cost of employee wages and benefits.
Added
Additionally, hurricanes, earthquakes, floods or other natural disasters may damage our physical facilities or those of our suppliers or customers. Climate change may increase the frequency or severity of weather-related events. Climate change may also have a negative effect on agricultural production resulting in decreased availability or less favorable pricing for certain commodities utilized in certain of our products.
Added
In addition, any perception of a failure to act responsibly with respect to the environment or to effectively respond to regulatory requirements concerning climate change could lead to adverse publicity, which could result in reduced demand for our products, damage to our reputation or increase the risk of litigation. Dependence on key personnel.
Added
We depend on information systems and technology, including public websites and cloud-based services, for many activities important to our business, including communications within our Company, interfacing with customers and consumers; ordering and managing inventory; managing and operating our facilities; protecting confidential information, including personal data we collect; maintaining accurate financial records and complying with regulatory, financial reporting, legal and tax requirements.
Added
Our business has in the past and could in the future be negatively affected by system shutdowns, degraded systems performance, systems disruptions or security incidents.
Added
These disruptions or incidents may be caused by cyberattacks and other cyber incidents, network or power outages, software, equipment or telecommunications failures, the unintentional or malicious actions of employees or contractors, natural disasters, fires or other catastrophic events.
Added
Similar risks exist with respect to our business partners and third-party providers, including suppliers, software and cloud-based service providers, that we rely upon for aspects of various business activities.
Added
Although the cyber incidents and other systems disruptions that we have experienced to date have not had a material effect on our business, such incidents or disruptions could have a material adverse effect on us in the future.
Added
If we are unable to timely respond to or resolve the issues related to such incidents and disruptions, such issues could have a material adverse effect on our business, financial condition, results of operations, cash flows and the timeliness with which we report our internal and external operating results. Material weaknesses in our internal control over financial reporting.
Added
Material weaknesses in our internal control over financial reporting which could, if not remediated, result in material misstatements in our consolidated financial statements.
Added
As discussed in Part II, Item 9A, “Controls and Procedures” of this Form 10-K, management has concluded that our internal controls related to certain review processes and disclosure controls and procedures were not effective as of April 27, 2024 due to the identified material weaknesses.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeITEM 4. Mine Safety Disclosures 13 PART II ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 13 ITEM 6. Reserved 15 ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 15 ITEM 7A. Quantitative and Qualitative Disclosure About Market Risk 21 ITEM 8.
Biggest changeITEM 4. Mine Safety Disclosures 11 PART II ITEM 5. Market for Registrant ’ s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 11 ITEM 6. Reserved 12 ITEM 7. Management ’ s Discussion and Analysis of Financial Condition and Results of Operations 13 ITEM 7A. Quantitative and Qualitative Disclosure About Market Risk 17 ITEM 8.
Financial Statements and Supplementary Data 22 ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 41 ITEM 9A. Controls and Procedures 41
Financial Statements and Supplementary Data 18 ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 36 ITEM 9A. Controls and Procedures 36

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+1 added−0 removed1 unchanged
Biggest changeIn the last five fiscal years, the Company paid special cash dividends on Common Stock as follows: ● $280.0 million ($3.00 per share) on December 29, 2021; ● $279.9 million ($3.00 per share) on January 29, 2021; and ● $135.2 million ($1.45 per share) on January 29, 2019; Our Board of Directors has authorized a program to repurchase 3.2 million shares of our common stock of which approximately 1.9 million shares remain available and authorized for repurchases. 13 Table of Contents Performance Graph The following graph shows a comparison of the five-year cumulative return of an investment of $100 cash on April 28, 2018, assuming reinvestment of dividends, of our Common Stock with the NASDAQ Composite Index, the Dow Jones US Soft Drinks Index and the S&P 500 Index.
Biggest changeOur Board of Directors has authorized a program to repurchase 3.2 million shares of our common stock of which approximately 1.9 million shares remain available and authorized for repurchases. 11 Table of Contents Performance Graph The following graph shows a comparison of the five-year cumulative return of an investment of $100 cash on April 27, 2019, assuming reinvestment of dividends, of our Common Stock with the NASDAQ Composite Index, the Dow Jones US Soft Drinks Index and the S&P 500 Index.
At June 16, 2023, there were approximately 40,200 holders of our Common Stock, the majority of which hold their shares in the names of banks, brokers and other financial institutions.
At June 17, 2024, there were approximately 41,700 holders of our Common Stock, the majority of which hold their shares in the names of banks, brokers and other financial institutions. On June 12, 2024, the Company's board of directors declared a special cash dividend of $3.25 per share.
Total Returns Index For: 4/28/2018 4/27/2019 5/02/2020 5/01/2021 4/30/2022 4/29/2023 National Beverage Corp. 100.00 66.22 57.66 119.05 114.71 129.34 NASDAQ Composite - Total Return 100.00 115.49 123.51 201.97 179.59 179.63 Dow Jones US Soft Drinks Index 100.00 120.32 121.91 148.37 177.04 191.45 S&P 500 Index - Total Return 100.00 112.33 110.37 165.75 166.10 170.53 14 Table of Contents
Total Returns Index For: 4/27/2019 5/02/2020 5/01/2021 4/30/2022 4/29/2023 4/27/2024 National Beverage Corp. $100.00 $87.08 $179.79 $173.24 $195.33 $171.20 NASDAQ Composite - Total Return 100.00 106.94 174.88 155.50 155.53 204.22 Dow Jones US Soft Drinks Index 100.00 101.32 123.31 147.14 159.11 156.16 S&P 500 Index - Total Return 100.00 98.25 147.55 147.87 151.80 188.57
Added
The special cash dividend will be paid on or before July 24, 2024 to shareholders of record on June 24, 2024. The Company paid special cash dividends of $279.9 million ($3.00 per share) on January 29, 2021 and December 29, 2021, respectively.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

31 edited+9 added−7 removed12 unchanged
Biggest changeCertain of our products are also distributed on a limited basis in other countries and options to expand distribution to other regions are being considered. To service a diverse customer base that includes numerous national retailers, as well as thousands of smaller “up-and-down-the-street” accounts, we utilize a hybrid distribution system consisting of warehouse and direct-store delivery.
Biggest changeTo service a diverse customer base that includes numerous national retailers, as well as thousands of smaller “up-and-down-the-street” accounts, we utilize a hybrid distribution system consisting of warehouse and direct-store delivery. The warehouse delivery system allows our retail partners to further maximize their assets by utilizing their ability to pick up beverages at our warehouses, further lowering their/our product costs.
Goodwill and intangible assets not subject to amortization are evaluated for impairment annually or sooner if we believe such assets may be impaired. An impairment loss is written down to its estimated fair market value based on discounted future cash flows. Income Taxes The Company’s effective income tax rate is based on estimates of taxes which will ultimately be payable.
Goodwill and intangible assets not subject to amortization are evaluated for impairment annually or sooner if we believe such assets may be impaired. An impairment loss is written down to its estimated fair value based on discounted future cash flows. Income Taxes The Company’s effective income tax rate is based on estimates of taxes which will ultimately be payable.
Standby letters of credit aggregating $2.2 million have been issued in connection with our self-insurance programs. These standby letters of credit expire through March 2024 and are expected to be renewed.
Standby letters of credit aggregating $2.2 million have been issued in connection with our self-insurance programs. These standby letters of credit expire through March 2025 and are expected to be renewed.
Certain statements including, without limitation, statements containing the words “believes,” “anticipates,” “intends,” “plans,” “expects,” and “estimates” constitute “forward-looking statements” and involve known and unknown risk, uncertainties and other factors that may cause the actual results, performance or achievements of our Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
Certain statements including, without limitation, statements containing the words “believes,” “anticipates,” “intends,” “plans,” “expects,” “estimates”, ”may,” “will,” “should,” “could,” and similar expressions constitute “forward- looking statements” and involve known and unknown risk, uncertainties and other factors that may cause the actual results, performance or achievements of our Company to be materially different from any future results, performance or achievements expressed or implied by such forward looking statements.
Our strategy seeks the profitable growth of our products by (i) developing healthier beverages in response to the global shift in consumer buying habits and tailoring our beverage portfolio to the preferences of a diverse mix of ‘crossover consumers’ – a growing group desiring a healthier alternative to artificially sweetened and high-caloric beverages; (ii) emphasizing unique flavor development and variety throughout our brands that appeal to multiple demographic groups; (iii) maintaining points of difference through innovative marketing, packaging and consumer engagement and (iv) responding faster and more creatively to changing consumer trends than larger competitors who are burdened by legacy production and distribution complexity and costs. 15 Table of Contents Presently, our primary market focus is the United States and Canada.
Our strategy seeks the profitable growth of our products by (i) developing healthier beverages in response to the global shift in consumer buying habits and tailoring our beverage portfolio to the preferences of a diverse mix of ‘crossover consumers’ – a growing group desiring a healthier alternative to artificially sweetened and high- caloric beverages; (ii) emphasizing unique flavor development and variety throughout our brands that appeal to multiple demographic groups; (iii) maintaining points of difference through innovative marketing, packaging and consumer engagement and (iv) responding faster and more creatively to changing consumer trends than larger competitors who are burdened by legacy production and distribution complexity and costs.
National Beverage Corp., in recent years, has transformed to an innovative, healthier refreshment company. From our corporate philosophy, development of products and marketing to manufacturing, we are converting consumers to a ‘ Better for You ’ thirst quencher that compassionately cares for their nutritional health.
National Beverage Corp., in recent years, has transformed into an innovative, healthier refreshment company. From our corporate philosophy, development of products and marketing to manufacturing, we are converting consumers to a ‘Better for You’ thirst quencher that compassionately cares for their nutritional health.
Discussions of fiscal year ended May 1, 2021 (Fiscal 2021) items and year-to-year comparisons between Fiscal 2022 and Fiscal 2021 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended April 30, 2022, which is available free of charge on our website at www.nationalbeverage.com .
Discussions of fiscal year ended April 30, 2022 (“Fiscal 2022”) results and year-to-year comparisons between Fiscal 2023 and Fiscal 2022 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended April 29, 2023, which is available free of charge on our website at www.nationalbeverage.com.
Gross profit per case was flat. Shipping and handling costs are included in selling, general and administrative expenses, the classification of which is consistent with many beverage companies. However, our gross margin may not be comparable to companies that include shipping and handling costs in cost of sales. See Note 1 of Notes to the Consolidated Financial Statements.
Shipping and handling costs are included in selling, general and administrative expenses, the classification of which is consistent with many beverage companies. However, our gross margin may not be comparable to companies that include shipping and handling costs in cost of sales. See Note 1- Significant Accounting Policies, of Notes to the Consolidated Financial Statements.
At April 29, 2023, we had $158.1 million in cash and cash equivalents and maintained $150 million in unsecured revolving credit facilities, under which no borrowings were outstanding and $2.2 million was reserved for standby letters of credit. We believe that existing capital resources will be sufficient to meet our liquidity and capital requirements for the next twelve months.
At April 27, 2024, we had $327.0 million in cash and cash equivalents and maintained unsecured revolving credit facilities totaling $150 million, under which no borrowings were outstanding and $2.2 million was reserved for standby letters of credit. We believe that existing capital resources will be sufficient to meet our liquidity and capital requirements for the next twelve months.
Such factors include, but are not limited to, the following: general economic and business conditions, pricing of competitive products, success of new product and flavor introductions, fluctuations in the costs and availability of raw materials and packaging supplies, ability to pass along cost increases to our customers, labor strikes or work stoppages or other interruptions in the employment of labor, continued retailer support for our products, changes in brand image, consumer demand and preferences and our success in creating products geared toward consumers’ tastes, success in implementing business strategies, changes in business strategy or development plans, government regulations, taxes or fees imposed on the sale of our products, unfavorable weather conditions and other factors referenced in this report, filings with the Securities and Exchange Commission and other reports to our stockholders.
Such factors include, but are not limited to, the following: general economic and business conditions, pricing of competitive products, success of new product and flavor introductions, fluctuations in the costs and availability of raw materials and packaging supplies, ability to pass along cost increases to our customers, labor strikes or work stoppages or other interruptions in the employment of labor, continued retailer support for our products, changes in brand image, consumer demand and preferences and our success in creating products geared toward consumers’ tastes, success in implementing business strategies, changes in business strategy or development plans, technology failures or cyberattacks on our technology systems or our effective response to technology failures or cyberattacks on our customers’, suppliers’ or other third parties’ technology systems, government regulations, taxes or fees imposed on the sale of our products, unfavorable weather conditions, changing weather patterns and natural disasters, climate change or legislative or regulatory responses to such change and other factors referenced in this report, filings with the Securities and Exchange Commission and other reports to our stockholders.
The recognition of these incentives involves the use of judgment related to performance and sales volume estimates that are made based on historical experience and other factors. Sales incentives are accounted for as a reduction of sales and actual amounts ultimately realized may vary from accrued amounts.
The recognition of these incentives involves the use of judgment related to performance and sales volume estimates that are made based on historical experience and other factors. Sales incentives are accounted for as a reduction of sales and actual amounts ultimately realized may vary from accrued amounts. Such differences are recorded once determined and have historically not been significant.
Annual contributions were $3.8 million for Fiscal 2023 and $4.0 million for Fiscal 2022. See Note 11 of Notes to Consolidated Financial Statements. We maintain self-insured and deductible programs for certain liability, medical and workers’ compensation exposures.
Annual contributions were $3.8 million for Fiscal 2024 and Fiscal 2023, respectively. See Note 11- Pension Plans, of Notes to Consolidated Financial Statements. 15 Table of Contents We maintain self-insured and deductible programs for certain liability, medical and workers’ compensation exposures.
Trade receivables increased $11.3 million and days sales outstanding was 33.3 days at April 29, 2023 compared to 30 days at April 30, 2022. Inventories decreased $9.7 million as a result of the reduced quantities of finished goods and raw materials. Annual inventory turns decreased to 7.9 from 8.2 times.
Inventories decreased $9.0 million as a result of the reduced quantities of finished goods and raw materials. Annual inventory turns increased to 8.6 times from 7.9 times. At April 27, 2024, the current ratio was 3.9 to 1 compared to 2.5 to 1 at April 29, 2023.
The differences between the effective rate and the federal statutory rate of 21% were primarily due to the effects of state income taxes. 17 Table of Contents LIQUIDITY AND FINANCIAL CONDITION Liquidity and Capital Resources Our principal source of funds is cash generated from operations.
The differences between the effective rate and the federal statutory rate of 21% were primarily due to the effects of state income taxes. 14 Table of Contents LIQUIDITY AND FINANCIAL CONDITION Liquidity and Capital Resources Our principal sources of liquidity are our existing cash and cash-equivalents, cash generated from operations and borrowing capacity available under our revolving credit facilities.
As a percent of net sales, selling, general and administrative expenses declined to 17.9% from 18.4% in Fiscal 2022. Other (Expense) Income - Net Other (expense) income, net includes interest income of $2.3 million for Fiscal 2023 and $.1 million for Fiscal 2022. The increase in interest income is due to increased average invested balances and higher return on investments.
As a percentage of net sales, selling, general and administrative expenses decreased to 17.6% compared to 17.9% in Fiscal 2023. Other Income (Expense), net Other income (expense), net includes primarily interest income of $12.2 million for Fiscal 2024 and $2.3 million for Fiscal 2023. The increase in interest income is due to increased average invested balances and higher yields.
We monitor our exposure to credit losses and maintain allowances for anticipated losses based on our experience with past due accounts, collectability and our analysis of customer data. 19 Table of Contents Impairment of Long-Lived Assets All long-lived assets, excluding goodwill and intangible assets not subject to amortization, are evaluated for impairment on the basis of undiscounted cash flows whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Impairment of Long-Lived Assets All long-lived assets, excluding goodwill and intangible assets not subject to amortization, are evaluated for impairment on the basis of undiscounted cash flows whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Our credit terms normally require payment within 30 days of delivery and may allow discounts for early payment. We estimate and reserve for bad debt exposure based on our experience with past due accounts, collectability and our analysis of customer data.
Our credit terms normally require payment within 30 days of delivery and may allow discounts for early payment. We estimate and reserve for credit losses based on our experience with past due accounts, collectability and our analysis of customer data. We offer various sales incentive arrangements to our customers that require customer performance or achievement of certain sales volume targets.
We offer various sales incentive arrangements to our customers that require customer performance or achievement of certain sales volume targets. Sales incentives are accrued over the period of benefit or expected sales. When the incentive is paid in advance, the aggregate incentive is recorded as a prepaid and amortized over the period of benefit.
Sales incentives are accrued over the period of benefit or expected sales. When the incentive is paid in advance, the aggregate incentive is recorded as a prepaid asset and amortized over the period of benefit.
Net Sales Net sales for Fiscal 2023 increased 3.1% to $1,173 million compared to $1,138 million for Fiscal 2022. The increase in sales resulted from a 8.4% increase in average selling price offset in part by a 4.9% decline in case volume, which impacted both Power+Brands and carbonated soft drinks.
Net Sales Net sales for Fiscal 2024 increased 1.6% to $1,191.7 million compared to $1,172.9 million for Fiscal 2023. The increase in sales resulted from a 1.8% increase in average selling price per case, partially offset by a 0.2% decline in case volume. The volume decline primarily impacted Power+Brands, partially offset by an increase in carbonated soft drink brands.
See Note 5 of Notes to the Consolidated Financial Statements. Expenditures for property, plant and equipment amounted to $22.0 million for Fiscal 2023 primarily for capital projects to expand our capacity, enhance sustainability and packaging capabilities and improve efficiencies at our production facilities.
Net cash used in investing activities for Fiscal 2024 reflects capital expenditures of $30.2 million, compared to capital expenditures of $22.0 million for Fiscal 2023. Expenditures for property, plant and equipment in Fiscal 2024 were primarily for capital projects to expand our capacity, enhance sustainability and packaging capabilities and improve efficiencies at our production facilities.
Income Taxes Our effective tax rate was 23.7% for Fiscal 2023 and 23.6% for Fiscal 2022.
Income Taxes For Fiscal 2024 and Fiscal 2023, our effective tax rates were 23.1% and 23.7%, respectively.
Gross Profit Gross profit for Fiscal 2023 was $396.8 million compared to $417.8 million for Fiscal 2022. The average cost per case increased 13.4% and gross margin decreased to 33.8% from 36.7% for Fiscal 2022. The decrease in gross margin is due to increases in packaging, ingredients and freight costs offset in part by increased average selling price.
Gross Profit Gross profit for Fiscal 2024 increased to $428.5 million compared to $396.8 million for Fiscal 2023. The increase in gross profit was primarily due to the increased average selling price per case and a decline in packaging costs. The cost of sales per case decreased 1.7% and gross margin increased to 36.0% compared to 33.8% for Fiscal 2023.
At April 29, 2023, the current ratio was 2.5 to 1 compared to 1.9 to 1 at April 30, 2022. 18 Table of Contents CONTRACTUAL OBLIGATIONS Contractual obligations at April 29, 2023 are payable as follows: (In thousands) Total 1 Year Or less 2 to 3 Years 4 to 5 Years More Than 5 Years Operating leases $ 44,674 $ 12,798 $ 17,903 $ 10,304 $ 3,669 Purchase commitments 19,535 19,535 - - - Total $ 64,209 $ 32,333 $ 17,903 $ 10,304 $ 3,669 We contribute to certain pension plans under collective bargaining agreements and to a discretionary profit sharing plan.
CONTRACTUAL OBLIGATIONS Contractual obligations at April 27, 2024 are payable as follows: (In thousands) Total 1 Year Or less 2 to 3 Years 4 to 5 Years More Than 5 Years Operating leases $ 61,169 $ 15,068 $ 25,229 $ 12,716 $ 8,156 Purchase commitments 39,106 39,007 99 - - Total $ 100,275 $ 54,075 $ 25,328 $ 12,716 $ 8,156 We contribute to certain pension plans under collective bargaining agreements and to a discretionary profit-sharing plan.
Selling, General and Administrative Expenses Selling, general and administrative expenses were approximately $210 million for both Fiscal 2023, and Fiscal 2022. Marketing and shipping costs declined and were offset by increased administrative costs. The decline in marketing costs was primarily due to reduced programs with retail partners.
Selling, General and Administrative Expenses Selling, general and administrative expenses for Fiscal 2024 decreased $0.2 million to $209.9 million from $210.1 million for Fiscal 2023. The decrease was primarily due to a decrease in shipping costs, partially offset by an increase in marketing and selling costs.
Included in current liabilities were amounts due CMA of $2.9 million at April 29, 2023 and $4.0 million at April 30, 2022. See Note 6 of Notes to the Consolidated Financial Statements. Cash Flows During Fiscal 2023, $161.7 million was provided by operating activities, $22.0 million was used in investing activities and $29.7 million was used in financing activities.
At April 27, 2024 and April 29, 2023, current liabilities included amounts due to CMA of $3.0 million and $2.9 million, respectively. See Note 6 - Capital Stock and Transactions with Related Parties, of Notes to the Consolidated Financial Statements.
Exposure to credit losses varies by customer principally due to the financial condition of each customer.
Exposure to credit losses varies by customer principally due to the financial condition of each customer. We monitor our exposure to credit losses and maintain allowances for anticipated credit losses based on our experience with past due accounts, collectability and our analysis of customer data.
Such differences are recorded once determined and have historically not been significant. 20 Table of Contents FORWARD-LOOKING STATEMENTS National Beverage Corp. and its representatives may make written or oral statements relating to future events or results relative to our financial, operational and business performance, achievements, objectives and strategies.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS See Note 1 – Significant Accounting Policies – Recently Issued Accounting Pronouncements, of Notes to the Consolidated Financial Statements, for a full description of recent accounting pronouncements including the respective expected dates of adoption and expected effects on the Company’s consolidated financial position, results of operations or liquidity. 16 Table of Contents FORWARD-LOOKING STATEMENTS National Beverage Corp. and its representatives may make written or oral statements relating to future events or results relative to our financial, operational and business performance, achievements, objectives and strategies.
Traditional and typical are not a part of an innovator’s vocabulary. 16 Table of Contents RESULTS OF OPERATIONS The following section generally discusses the fiscal years ended April 29, 2023 (Fiscal 2023) and April 30, 2022 (Fiscal 2022) items and year-to-year comparisons between Fiscal 2023 and Fiscal 2022.
Management believes these corrections did not in any way limit investment opportunities during these periods. 13 Table of Contents RESULTS OF OPERATIONS The following section generally discusses the fiscal years ended April 27, 2024 (“Fiscal 2024”) and April 29, 2023 (“Fiscal 2023”) results and year-to-year comparisons between Fiscal 2024 and Fiscal 2023.
In this report, the terms “we,” “us,” “our,” “Company” and “National Beverage” mean National Beverage Corp. and its subsidiaries unless indicated otherwise. Our operating results are affected by numerous factors, including fluctuations in the costs of raw materials, holiday and seasonal programming and weather conditions.
National Beverage Corp. is incorporated in Delaware and began trading as a public company on the NASDAQ Stock Market in 1991. In this report, the terms “we,” “us,” “our,” “Company” and “National Beverage” mean National Beverage Corp. and its subsidiaries unless indicated otherwise.
We intend to continue capacity and efficiency improvement projects in Fiscal 2024 and expect capital expenditures to be comparable to Fiscal 2022. Pursuant to a management agreement, we incurred a fee to Corporate Management Advisors, Inc. (CMA) of $11.9 million for Fiscal 2023 and $11.4 million for Fiscal 2022.
See Note 5 - Debt, of Notes to the Consolidated Financial Statements. Pursuant to a management agreement, we incurred fees to Corporate Management Advisors, Inc. (“CMA”) of $11.9 million and $11.7 million for Fiscal 2024 and Fiscal 2023, respectively.
Financial Position During Fiscal 2023, our working capital increased $92.9 million to $222.1 million. The increase in working capital resulted from increased cash and equivalents generated by operations, increased trade receivables offset in part by lower inventories and reduced income tax prepayments.
The increase in working capital primarily resulted from increased cash and cash equivalents generated by operations of $169.0 million and other net working capital increases of $7.9 million. Trade receivables decreased $2.1 million and days sales outstanding was 31.5 days at April 27, 2024 compared to 33.3 days at April 29, 2023.
Removed
We are committed to our quest to innovate for the joy, benefit and enjoyment of our consumers’ healthier lifestyle! We believe our brands are uniquely positioned in three distinctive ways: (1) The new consumer is the most competent/knowledgeable product analyzer ever, and personal mental/physical lifestyles demand that healthier is their preferred choice.
Added
We are committed to our quest to innovate for the joy, benefit and enjoyment of our consumers’ healthier lifestyle. The majority of our brands are geared to the active and health-conscious consumer including sparkling waters, energy drinks and juices.
Removed
Calories must qualify as worthy; sugar being enemy #1 in the life of the Millennial and younger consumers. (2) The retail industry is in a revolution.
Added
Our portfolio of Power+ Brands includes LaCroix®, LaCroix Cúrate® and LaCroix NiCola® sparkling water products; Clear Fruit® non-carbonated water beverages enhanced with fruit flavor; Rip It® energy drinks and shots; and Everfresh®, Everfresh Premier Varietals™ and Mr. Pure® 100% juice and juice-based products.
Removed
In prior years, each retailer induced their consumer with a proprietary brand (especially soft drinks), but today understands that the well-informed, smart consumer is demanding that retailers provide recognizable brands that have earned their respective consumer standing on their merits. (3) Retail today is in the most competitively-indexed service industry, without exception.
Added
Additionally, we produce and distribute carbonated soft drinks including Shasta® and Faygo®, iconic brands whose consumer loyalty spans more than 135 years.
Removed
Innovation, plus the urgent time demands on the consumer, requires quick, expedient shopping. Home delivery is even more of a current shoppers’ choice. Retailers cannot carry slower-moving items that home delivery will not support.
Added
Presently, our primary market focus is the United States and Canada. Certain of our beverages are also distributed on a limited basis in other countries and options to expand distribution to other regions are being pursued.
Removed
The warehouse delivery system allows our retail partners to further maximize their assets by utilizing their ability to pick up product at our warehouses, further lowering their/our product costs. National Beverage Corp. is incorporated in Delaware and began trading as a public company on the NASDAQ Stock Market in 1991.
Added
Our operating results are affected by numerous factors, including fluctuations in the costs of raw materials, supply chain disruptions, holiday and seasonal programming and weather conditions. Beverage sales are seasonal with higher sales volume realized during the summer months when outdoor activities are more prevalent. See “Item 1A.
Removed
While prior years witnessed more seasonality, higher sales are realized during the summer when outdoor activities are more prevalent.
Added
Risk Factors” in Part I of this report for additional information about risks and uncertainties facing our Company. Also, see Note 14 - Restatements for certain cash flow restatements.
Removed
Cash provided by operating activities increased $28.5 million due to reduced net working capital other than cash, change in deferred taxes offset in part by lower net income. Cash used in investing activities decreased $7.1 million due to lower capital expenditures. Cash used in financing activities includes a $30 million repayment of our Loan Facility.
Added
Cash Flows The Company’s cash position increased $169.0 million for Fiscal 2024 compared to an increase of $110.0 million for Fiscal 2023. Net cash provided by operating activities for Fiscal 2024 was $197.9 million compared to $161.7 million for Fiscal 2023.
Added
For Fiscal 2024, cash flow provided by operating activities was principally provided by an increase in operating income, a reduction in working capital other than cash, an increase in net interest income, partially offset by an increase in tax and lease payments.
Added
We intend to continue such projects in Fiscal 2025 and anticipate Fiscal 2025 capital expenditures to be comparable to Fiscal 2024. Financial Position During Fiscal 2024, our working capital increased $176.9 million to $398.9 million.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed2 unchanged
Biggest changeInterest Rates At April 29, 2023, the Company had no borrowings outstanding. Based on a 1 percentage point increase, interest rates would have increased interest expense by $.1 million in Fiscal 2023. We are also subject to interest rate risk related to our investment in highly liquid short duration investment securities.
Biggest changeInterest Rates At April 27, 2024, the Company had no borrowings outstanding. We are also subject to interest rate risk related to our investment in highly liquid short-duration investment securities which are considered cash equivalents. These investments are managed with the guidelines of the Company’s investment policy.
These investments are managed with the guidelines of the Company’s investment policy. Our policy requires investments to be investment grade, with the primary objective of minimizing the risk of principal loss. In addition, our policy limits the amount of credit exposure to any one issue. 21 Table of Contents
Our policy requires investments to be investment grade, within the primary objective of minimizing the risk of principal loss. In addition, our policy limits the amount of exposure to any one issue. 17 Table of Contents

Other FIZZ 10-K year-over-year comparisons