viewThe Alkaline Water Company

The Alkaline Water Company makes a splash with its flagship brand Alkaline88 driving sales and brand extensions

The company delivered record $7.1 million in April sales driven by Alkaline88 and its brand extensions into flavor-infused waters and CBD products

The Alkaline Water Company - The Alkaline Water Company makes a splash with its flagship brand Alkaline88 driving sales and brand extensions
The Scottsdale, Arizona-based company has capitalized on the popularity of its Alkaline88 brand to make inroads into flavored-infused waters, and CBD infused products marketed under the A88 Infused and A88CBD brand names

The Alkaline Water Company Inc (NASDAQ:WTER) (CSE:WTER) is making a big splash with its trendy, flagship Alkaline88 water brand which is driving sales and brand extensions into lucrative new areas.

Founded in 2012, the Scottsdale, Arizona-based company has capitalized on the popularity of its trademarked Alkaline88 brand to make inroads into flavor-infused waters, and CBD-infused products marketed under the A88 Infused and A88CBD brand names.

Tap water, spring water, well water, mineral water, regardless of the labels, all of these beverages do the same thing. Hydrate. Right? Not if you ask specialized water companies across the country.

WATCH: The Alkaline Water Company sees 'plenty of green space' in the CBD market

The Alkaline Water Company says that through its proprietary electrolysis process, Alkaline88 delivers “perfect 8.8 pH balanced alkaline drinking water for better hydration,” with trace minerals and electrolytes derived from pure pink Himalayan rock salt for “better body balance.”

“Alkaline88 has built solid brand equity with our loyal base of customers. Our core brand continues to be the No.1 selling bulk alkaline water in the US,” Alkaline Water Company CEO Richard A Wright told Proactive.

Consumers are drawn to alkaline water’s purported health benefits which include fast rehydration and replacement of minerals lost through exercise, according to a report from drinks expert Zenith Global. Other studies confirm that many foods and drinks alter our body’s pH to acidic, so by consuming alkaline water we can counteract the acidity and restore balance to the body.

Blockbuster sales

Millennials are certainly on board with the trend. As a result, the company reported a 171% year-over-year jump in monthly sales in April to a record $7.1 million with demand for Alkaline88 at an all-time high.

"April was another month of strong demand for our flagship brand, Alkaline88. These strong results are a testament to the solid execution by our team, our partners, and our resilient business model,” said Wright.

"Our brand extension into the CBD infused consumer goods space is also seeing good traction. Our A88CBD lines of topical and ingestible products are now available online at our e-commerce site, A88CBD.com, and at our newly added online and brick-and-mortar stores in select markets,” he added.

Meanwhile, the Alkaline88 brand continues to expand within some of the largest retailers in the world. The company’s core product is now currently available in over 60,000 retail store locations. The company has delivered its product to major retailers across the country, including Walmart, Kroger, Rite Aid, Albertsons/Safeway, Publix, HEB, Sprouts, a top German retailer with stores on the east coast as well as numerous local and regional chains.

Riding the eco-friendly wave

The company has also delivered over 300,000 easily recyclable eco-friendly aluminum bottles to the California and Texas markets.

“Alkaline88 received its largest order to date for its new 500-ml environmentally friendly aluminum bottles. We delivered approximately 300,000 bottles to two regional customers located in the California and Texas markets,” said Wright.

Since its launch in February, the company pointed out that it has seen “keen interest” in its light-weight aluminum bottles that need less power to cool than plastics — particularly useful in summer.

“While still early in the cycle, we see backlog building for this product that is being well received by our consumers. In addition, we are seeing retailers increase shelf space for eco-friendly merchandise as consumer demand for sustainable packaging options continues to grow. Our brand extension to aluminum bottles has been very timely,” said Wright.

Supply chain running smoothly

In April, the company increased production capacity significantly to meet rising demand. The Alkaline Water Company now has eight co-packer partnerships across the entire country and plans to bring on a new plant to give the company additional capacity to meet the upcoming summer demand.

“Our entire supply chain is running effectively and we have significantly increased throughput as demand for our products is at an all-time high across all categories. Since we are the largest customer for our co-packers nationwide, they have increased dedicated line-time across our facilities. In addition, some of the plants and supply chain providers are running 24/7,” said Wright.

“With bottled water considered an 'essential' item, all our facilities remain fully operational, and we are committed to playing our role in thwarting this global pandemic,” he added, referring to the coronavirus (COVID-19) crisis.

A88 Infused waters and A88CBD

The Alkaline Water Company has aggressively expanded the sales channels for its growing portfolio of A88CBD products as sales of CBD are booming as the nation battles the coronavirus pandemic.

The A88CBD brad portfolio offers capsules with 25 mg of high-quality, lab-tested full-spectrum hemp, CBD infused oil tinctures, gummies, beverage shots and powder packs.

“With CBD sales surging during the COVID-19 related quarantines, we are thrilled to announce multiple new brick-and-mortar and online marketplace partnerships that expand the availability of our A88CBD portfolio of products,” said Wright.

“Our flagship brand Alkaline88 has seen tremendous success on Amazon.com already, and we expect this trend to continue as consumers enjoy our growing line of A88CBD topical products.”

The company has partnered with CBD.co, a leading online market for CBD users and wholesale retailers, to provide a direct channel to buyers.

“Establishing a substantial brick-and-mortar presence is key to our A88CBD growth strategy. We are excited that our topical products will now be available at select Vitamin Plus locations in the Texas market and at all Pure CBD locations in the Los Angeles market,” said Wright.

Both US retailers focus on the health and wellness lifestyle-oriented consumer, which aligns with the company’s all-natural products.

“Our topical products use the highest quality, lab-tested hemp-derived CBD, and we provide complete transparency with certificate of analysis for our entire line of A88CBD products,” said Wright.

With a growing online and brick-and-mortar presence and a healthy sales pipeline across multiple retail channels, the company is well-positioned to establish A88CBD as a leading brand in the nascent CBD infused products market.

Business is booming

"Our brand extension into the CBD infused consumer goods space is seeing good traction,” said Wright. “Our family of brands, Alkaline88, A88 Infused, and A88CBD Infused, include a growing portfolio of products that are in-demand and resonate with consumers.”

Well-financed suitors may well be interested in the Alkaline Water Company given its unique niche. After all, a Neilson report ranked Alkaline88 as “one of the fastest growing” value-added waters in 2019. It also noted that it has built a "national retail footprint" and extended its lifestyle brands into other consumer packaged goods categories.

The US cannabis-infused beverage market is projected to grow to $1.4 billion by 2024. Separately, the Beverage Marketing Corporation has pegged the size of the US bottled water market at more than $19 billion in 2019.

Against this backdrop, it’s hardly surprising that there’s rapid consolidation in the space, and Keurig Dr Pepper agreed to recently acquire US premium water company Core Nutrition for $525 million.

Contact the author Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter: @UttaraProactive

Quick facts: The Alkaline Water Company

Price: 1.21 USD

Market: NASDAQ
Market Cap: $94 m

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