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'Monster Energy Sunrise will have 'Orangina-type flavor': CEO Rodney Sacks

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By Ben Bouckley+

08-Aug-2014
Last updated on 08-Aug-2014 at 22:34 GMT

Monster Energy CEO Rodney Sacks insists new launch Ultra Sunrise will not go head-to-head PepsiCo's Mountain Dew Kickstart, despite its lighter 'Orangina-type flavor'.

The company beat analyst expectations to report strong Q2 net sales of $687.2m (+8.9%) and net income of $141m (+31.9%).

But Sacks warned of “less robust” growth for the US energy category as a whole, and blamed subdued sales of 5-Hour Energy in particular.

“We think the energy category is being slowed down a little bit by the negative growth that is being experienced by 5-Hour…we lump it in the same kind of category,” Sacks said.

5-Hour Energy acting as a brake on the category

The winners as per Nielsen across all channels? Monster dollar sales were up 9% in the 13 weeks to July 26 2014 with 5.3% growth for the category as a whole; Red Bull sales were up 4.3%, NOS up an impressive 30.5%.

The losers? Rockstar’s sales were flat over the quarter (though down 7.2% in the four weeks to July 26), 5-Hour Energy was down 2.5% and AMP down 11.1%.

Nielsen figures for the four weeks ending July 26 show that in the key US C-store and gas channel alone Monster's market share was up 0.6% year-on-year to 34.6%, while Red Bull’s fell to 35.3%; Rockstar (6.9%) and 5-Hour (9%) both lost ground.

Consumers want lighter drinks - 'lighter in calories, lighter in taste'

“Overall we are just seeing that slowing trend,” Sacks added during yesterday's call, after Jeffries analyst Kevin Grundy noted a slowdown from double-digit to single-digit growth in the C-store and gas channel.

Why is this happening? Well, Sacks blames health concerns over carbonated soft drinks (CSDs) that have spilled over into dark CSDs (this includes Monster), but believes these will pass.

“But there are certainly some changing consumer trends and preferences. We will deal with some of them by adapting our products to be more drinkable, to be lighter, lighter in calories and lighter in taste.”

Monster is just like like, err, wine...

Monster aimed at this profile with its Ultra line, he said, and is reformulating its juice line with less juice for a lighter drink.

“On the other hand, a majority of consumers still like full-flavored, heavy bodied drinks – just as they like light wines and they like heavy wines,” Sacks said.

Monster is trying to cater for the “full gamut of consumers”, he said, noting that it introduced Muscle Monster for “pure sports people or bodybuilders” to get protein as well as energy.

Click through our gallery, which begins below, for the inside track on Monster's slated 2014/15 launches, starting with Ultra Sunrise.

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