Former Hawaii-based beverage firm KonaRed Corp. reduced its financial loss last year by increasing sales as it focused more on cold-brew coffee and less on the “superfruit” drinks, made from coffee cherries, on which the company was founded.
KonaRed reported Thursday that it lost $3.3 million last year compared with $3.8 million the year before. The improvement was mainly due to a 67 percent increase in sales to $1.1 million last year from $635,503 the year before.
The company, previously based on Kauai but now solely operating out of San Clemente, Calif., where it has a distribution center, said the sales growth was largely from getting its line of cold-brew coffees into more outlets and repeat customer sales.
“Cold brew is now KonaRed’s major marketing focus,” the company said in its annual report filed with the U.S. Securities and Exchange Commission. “Overall, cold brew coffee is a booming new market sector and KonaRed has emerged early as a leader in this new category.”
| 2016 loss
$3.3 million
Year-earlier loss
$3.8 million
|
KonaRed was established in 2008 on Kauai, intending to compete in the sports drink market with juices made from the fruit surrounding coffee beans harvested on a Hawaii island farm. In February 2016, the company began selling cold-brew coffee in three flavors. Through the end of last year, coffee accounted for 59 percent of KonaRed sales. That figure was 69 percent in the fourth quarter, and now the company has five flavors of cold-brew coffee.
Since it was founded, KonaRed and its investors have accrued a deficit of about $23 million, which includes heavy spending on research and development of the superfruit drinks as well as advertising and marketing expenses tied to establishing a new brand.
To keep up operations, KonaRed continues raising money through stock sales. Last year, the company said, it raised $1.4 million selling shares of stock.
KonaRed listed its stock for public trading in 2013, and shares hit a high of $1.24 in 2014. Over the past 52 weeks, shares have closed between about 5 cents on July 12 and 9 cents on Jan. 31. On Thursday, KonaRed stock closed at 8 cents.
