The downside of the coronavirus pandemic and how crippling it was to certain industries has been well documented, but it should not be overlooked that some companies benefited from lockdowns and a focus on healthier habits. Beverage makers, particularly those emphasizing health and alternatives to carbonated sodas, saw a spike in sales as consumers stocked up bottled water, sports drinks and more. Higher demand created an exceptionally attractive market climate and rising revenue for The Alkaline Water Company Inc. (NASDAQ: WTER)(CSE: WTER) (Profile), the U.S.'s largest independent alkaline water company, and its Alkaline88(R) brand. Bigger peers lent further credence to the trend, as evidenced by impressive financial reports from beverage makers such as Keurig Dr Pepper Inc. (NASDAQ: KDP), Celsius Holdings Inc. (NASDAQ: CELH), NewAge Inc. (NASDAQ: NBEV) and National Beverage Corp. (NASDAQ: FIZZ), many of which have leaned on acquisitions to fuel their growth.
With sales surging 28% in full-year 2020 to $41.1 million, WTER is now the largest independent alkaline water company in America.
Alkaline water is an emerging market forecast to reach $1 billion by 2022.
On average, each American drank 43.7 gallons of bottled water in 2019, contributing to $34.6 billion in industry sales.
NBA icon Shaquille O'Neal has become an equity partner in WTER; will serve as advisor, marquee brand ambassador.
The Dominant Player in Alkaline Water
In 2019, bottled water for the fourth consecutive year was the most popular beverage in America by volume, outselling carbonated soft drinks yet again, according to Beverage Marketing Corporation; sales in 2019 reached $34.6 billion. Data from market research firm Statista shows that 88% of Americas drink water every day, and 26% buy name brand water as part of drinking, on average 43.7 gallons, of bottled water in 2019. That's about 15.3 ounces per day for every person in the country.
The megatrend the water majors are now trying to capture is the increasing consumer health consciousness towards enhanced water as a replacement for sugary drinks, a trend that was emphasized by the pandemic. Fact is that people bought more of or were introduced to value-added water for the first time during COVID-19 lockdowns for any number of reasons, and many of those consumers have now incorporated these functional beverages as part of their lifestyle.
The Alkaline Water Company Inc. (NASDAQ: WTER) (CSE: WTER) is the largest independent player in the alkaline water market with expectations of reaching $1 billion by next year. As the name implies, the Scottsdale, Arizona-based company specializes in producing drinking water with trace minerals and electrolytes. Its "secret sauce" is in using technology to offer water with an alkaline pH of 8.8, compared to a neutral pH of 7.0 for regular drinking water. The higher pH is believed by advocates to have a bevy of benefits, potentially slowing the aging process, regulating the body's pH level (neutralizing acidity commonly presented in some diseases) and deactivating pepsin, a principal culprit in acid reflux, although WTER does not make any of these claims.
In 2019, WTER widened its portfolio beyond its flagship Alkaline88 brand with the launch of six flavor-infused products branded A88 Infused(TM). The products are sold in an estimated 75,000 retail stores, which while impressive, leaves plenty of head room for growth as it represents only 8% of all retail and hospitality outlets available to consumers. Management has a goal of reaching 90,000–100,000 retail locations in the next year. Any bigger peer looking for immediate market share could leverage WTER's existing distribution — plus its direct-to-store Delivery (DSD) platform that now reaches over 10,000 customers — combine it with their network and dominate the alkaline water market se...
(All Rights Reserved)