Flow Beverage Corp. FLWBF, a premium and sustainable water company, reported its Q1 2023 financial results in March. The Toronto-based company reported increased revenue as well as improved operational efficiency building on financial results in 2022. Here are some of the highlights from its latest financial results and a peek into what the company has planned for the rest of the year.
Flow’s Brand Gains Traction Following New Partnerships and Distribution Agreements
Net brand revenues grew 40% to $7.9 million in the first quarter. That growth was driven largely by new partnerships, an increase in orders, and more retailers stocking their shelves with Flow’s latest line of vitamin-infused waters.
The company’s market share in U.S. multi-outlet and natural retail sectors increased to 45% in Q1 2023 as it maintained its leadership position in the carton format and shelf-stable water segments. The number of stores selling Flow products nearly doubled from about 24,500 in Q4 2022 to over 46,000 by the end of Q1 2023.
In November, Flow closed the sale of its production facility in Verona, Virginia to BioSteel Sports Nutrition for $19.5 million. The deal includes a co-manufacturing agreement under which BioSteel will keep producing Flow products at the Verona facility during a transition period. It also allows Flow to retain ownership of the 144-acre artesian spring in Verona, where it sustainably sources its naturally alkaline water.
The sale was part of a larger plan to strengthen Flow’s balance sheet by simplifying its operating model and lowering the cost of goods sold. The company also realized $7.5 million in savings for the quarter via internal restructuring and working capital improvements related to the Verona facility sale.
Flow also signed a number of new contracts and agreements last year, including:
- An agreement with Starbucks SBUX that will make Flow products available across 1,000 Canadian Starbucks locations.
- A distribution agreement with Foodbuy Foodservice, a major food service procurement organization, that will bring Flow Alkaline Spring Water to more than 11,000 new points of distribution and expand Flow’s penetration into hospitality, food service, healthcare, education, and other markets.
- A distribution agreement with Primo Water PRMW that will make Flow products available to Primo’s 1.8 million subscription customers in the United States.
- An agreement with Norwegian Cruise Line NCLH to make Flow the global cruise line’s official water.
- A distribution agreement with WB Canna Co. & Wellness that will help Flow expand into new territory, including up to 25 Caribbean markets and seven Central American markets.
The Sustainable Premium Water Company Plans To Keep Up The Momentum Throughout 2023
Building on its strong performance in 2022, Flow started the year with yet another win in the form of an expanded distribution agreement with Costco COST signed in January that will put Flow products in 48 new Eastern Canada locations, bringing the total number of Costco locations to 63.
That same month, the company announced the launch of its line of vitamin-infused water in Canada. 22 retailers with a combined total of 800 locations have either authorized listing or taken delivery of the new product. It was also picked up by eight national distributors.
The fast-growing premium water company says it has no plans to stop scaling anytime soon. Sitting at the intersection of the $22 billion premium water market and the $15.1 billion functional water market, Flow’s product line still could have plenty of room to expand into new territories and market segments.
Its reports that its commitment to working toward high standards of environmental and social sustainability has also made it a favorite brand among eco-conscious consumers. The certified B-Corp publicly releases a Sustainability Accounting Standards Board (SASB) Report each year disclosing the social and environmental impact of its business.
So far, the company has achieved net-zero operational emissions and its product packaging is already 100% recyclable. It’s also made from at least 68% renewable materials like sugarcane and renewable paperboard. By 2025, it plans to have 100% renewable packaging and a water management system that recycles 98% of its processing water.
In an effort to maintain its rapid pace of growth, Flow is shoring up an enhanced cash position composed of savings and proceeds from the Verona facility sale. To add to that, the company secured CAD 20.3 Million (approximately 15 million USD) in debt from NFS Leasing Canada Ltd in January. Flow plans to use the cash to continue growing its revenue streams while optimizing operations throughout the year.
Featured Photo by Pixabay on Pexels
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