Celsius Holdings says Q3 revenue benefited by about $20M due to inventory build

On the company’s Q3 earnings call, Celsius CFO Jarrod Langhans stated, according to a transcript: “Moving to a few comments around quarter over quarter activity to provide some additional insight into our recent activity. Revenue for the third quarter increased sequentially by 18%, driven by distribution gains across tracked and untracked channels as well as SKUs per location and SKU placement. In addition to these drivers, we benefited from some inventory building within our primary distributor, as well as from adjustments to our promotional allowances with some offsets to our growth as a result of mix within our SKUs and channels. An estimate of the impact of inventory promos and SKU channel mix compared to Q2 would have been roughly $20 million. Gross profit dollars increased by 22% and gross margin improved by 165 basis points sequentially from the second quarter, driven by positive adjustments to our promotional allowance accounts as we maintained our leverage across raw materials, freight and scrap rates. Excluding the promotional allowance benefit, we would have had gross profit margins consistent with Q2.”