Reborn Coffee Provides Fourth Quarter and Full Year 2024 Corporate Update and Financial Results
FY 2024 Annual Revenue Growth to $5.9 Million and Strong 31% Increase in Q4 Revenue to $1.8 Million
Approved as U.S. Franchisor and Signed Commitments for 33 New Locations Through a Combination of Area Development and Franchise Agreements
BREA, Calif., March 31, 2025 (GLOBE NEWSWIRE) -- Reborn Coffee Inc. (Nasdaq: REBN), a leader in the specialty coffee market, has reported its financial and operational results for the fourth quarter and year ended December 31, 2024.
Key Financial and Operational Highlights
-- Q4'24 revenue improved 31% to $1.8 million, compared to $1.4 million in
Q4'23.
-- Despite higher food costs, in the full year 2024 revenue improved 8% to
$5.9 million as compared to $5.5 million the same period revenue in 2023.
-- Company-operated store gross margins for the year ended December 31,
2024, decreased to 63% compared to 66% for the same period in 2023.
-- Ended Q4'24 with 11 open locations, with 1 location in development,
reinforcing our national growth strategy.
-- Full Year 2024 wholesale and online sales grew 47% to $0.4 million from
$0.2 million in 2023, as Reborn Coffee continues to scale its omnichannel
footprint.
Q4 2024 and Subsequent Events
-- Approved as U.S. Franchisor, setting the stage for expansive growth
across U.S. markets.
-- Signed commitments for 33 new locations through a combination of
area development and franchise agreements following a highly
successful Franchise Seminar.
-- Bosco Bakery in Los Angeles, California joined Reborn Coffee as a
franchise, marking a strategic expansion into the artisan bakery
segment.
-- Partnered with Eachome Shopping, a retail platform under Shenzhen Media
Group, offering a wide range of products and services to consumers across
China, to expand retail footprint across China.
-- Announced Reborn Coffee Dubai, the Middle Eastern hub of Reborn Coffee's
international expansion, is spearheading a bold new initiative to
establish flagship locations in Europe. Openings are set for Vienna,
Austria; Florence, Italy; and Prague, Czech Republic.
-- Collaborating with Finlays, a global leader in premium tea and coffee
solutions, to launch new ready-to-drink (RTD) 4th Wave Cold Brew product
line.
-- Acquired a 58% stake in Bbang Ssaem Bakery, one of Korea's most iconic
bakery brands with an estimated $7 million trailing twelve months revenue
through November, 2024, serving as a launchpad for Reborn Coffee's entry
into the South Korean franchise market and deliver premium coffee and
bakery experiences to new locations.
-- Landmark distribution agreement through Bbang Ssaem Bakery F&B
will bring Reborn's preservative-free, signature baked goods to
approximately 8,000 stores of a major coffee chain across South
Korea.
-- Entered into a securities purchase agreement and a common stock purchase
agreement for up to a total of $60 million in financing commitments with
Arena Investors, LP ("Arena") and Arena Business Solutions Global SPC II,
Ltd. ("ABS").
Management Commentary
"The fourth quarter and early 2025 was highlighted by strong progress of our global expansion initiatives and the rollout of our U.S. franchise business," said Jay Kim, Chief Executive Officer of Reborn. "Our U.S. company stores faced ongoing challenges with the combination of rising input costs, heightened consumer price sensitivity, and increased capital costs that affected gross margins. Despite these challenges, we improved revenue in 2024 by 8% through the opening of new locations, and a strong focus on marketing efforts to grow brand recognition. We also continue to optimize operating expenses while maintaining a strong Average Unit Volume ("AUV") comparable to previous periods.
"We were recently approved as a U.S. franchisor, setting the stage for an ambitious expansion plan, targeting the opening of more than 100 franchise locations nationwide within the next three years. We are now approved to operate in the state of California and non-franchise registration states, with additional franchise approvals in other registration states actively in progress. This phased approach ensures a strategic and comprehensive nationwide rollout. Following a highly successful Franchise Seminar held in February, we secured commitments for 33 new franchise locations in California, Florida, Georgia, Arizona and more. With our area development model, we are accelerating our footprint nationwide while ensuring strong local partnerships that will drive operational success. Most recently, Bosco Bakery in Los Angeles, California officially joined Reborn Coffee as a franchise. This flagship franchise will serve as a model for future hybrid café-bakery locations.
"Internationally, we partnered with Eachome Shopping in China to scale our retail presence by integrating with their extensive online and offline platforms. By leveraging Eachome Shopping's robust media resources, we aim to enhance brand visibility and engage a broader consumer base. The collaboration also paves the way for future online ventures, with aspirations to expand beyond China into the broader Southeast Asian market. Concurrently, Reborn Coffee Dubai is working to establish flagship locations in Europe including Vienna, Austria; Florence, Italy; and Prague, Czech Republic. The Prague flagship store is set to open in June 2025, strategically aligning with the peak tourist season, with announcements for Florence and Prague coming soon.
"We have also made progress for the launch of our Ready-To-Drink (RTD) 4th Wave Cold Brew product line, partnering for launch with Finlays, a global leader in premium tea and coffee solutions. Finlays was selected for its state-of-the-art cold brew extraction process, which ensures superior flavor and extended shelf life for RTD coffee beverages. The collaboration has resulted in three distinct offerings including Miami Passion, Signature Blend, and Single-Origin Colombian Cold Brew. The RTD cold brew coffee market continues to experience double-digit growth as consumers seek healthier, more convenient options for their fast-paced lifestyles. Reborn Cold Brew will stand out by delivering a smoother, less acidic coffee experience with natural ingredients, zero sugar, and bold caffeine flavors tailored to a new generation of coffee drinkers.
"Looking ahead, we believe our growing international presence, introduction of innovative new products, rapidly expanding online ecommerce sales, and targeted marketing initiatives will deliver on our comprehensive growth strategy in the long term. We are working diligently to expand and diversify our global operations with strategic partnerships and initiatives across Asia, Eastern Europe, and the Middle East in some of the world's fastest-growing coffee markets. Our longer-term goals extend beyond these regions, and we have established a target of over 300 locations worldwide within the next two years designed to establish Reborn Coffee as a household name around the world. As we continue to penetrate new markets, we are poised to redefine the future of specialty coffee on a global scale.
"At our US retail locations and ecommerce, we will continue to focus on driving sales and improving gross profit, enhanced by new beverages, complementary product launches, and new company-owned retail locations. We believe the newly secured franchise agreements underscore the strong demand for Reborn Coffee's specialty coffee, tea, and bakery concept, and the franchise model will position us as a leading force in the U.S. coffee industry. We look forward to additional updates on our anticipated milestones in the weeks and months to come," concluded Kim.
Anticipated Milestones
-- Accelerate Reborn Coffee's footprint across China with multiple flagship
stores opening in key tier-1 cities including Guangzhou, Shanghai, and
Shenzhen, supported by regional master license agreements to drive
multi-unit expansion.
-- Establish a landmark flagship café inside the New Century Global
Center in Chengdu, one of the largest shopping complexes in the world,
integrating café, tea, and bakery concepts in a premium lifestyle
destination.
-- Expand into Northern China through our Shenyang flagship location, with a
focus on family-oriented retail experiences and integration into
large-scale amusement and entertainment complexes via strategic partners.
-- Introduce AI-powered operational systems in new China stores, with future
rollout planned across U.S. franchise locations to enhance efficiency,
consistency, and customer engagement.
-- Strengthen our presence in Southern China, with a focus on the Greater
Bay Area as a key growth hub, aligning with Reborn's lifestyle branding
and café experiences.
-- Initiate global distribution of Reborn's patented Coffeeware, starting
with the Reborn Tumbler, targeting specialty coffee markets in the U.S.,
China, Korea, and Southeast Asia, with plans to license or co-develop
additional designs.
-- Open flagship location in Dubai, UAE, as a launchpad into the Middle East
region, with plans for 20+ additional locations, supported by a
centralized distribution center, roasting facility, and regional
warehouse to support scalability.
-- Strengthen omnichannel revenue streams through expanded wholesale,
ecommerce, and RTD cold brew product sales across major digital and
retail platforms.
Fourth Quarter and Full Year 2024 Financial Results
Revenues were $1.8 million for the three months ended December 31, 2024, compared to $1.4 million for the comparable period in 2023, representing an increase of 31%. The increase in sales for the period was primarily due to increased customer traffic as a result of enhanced brand awareness and expanded marketing efforts. For the year ended December 31, 2024, revenues were $5.9 million, compared to $5.5 million in the prior year period, an increase of 8%. The increase in sales for the periods were primarily driven by the opening of new locations, and to the continued focus on marketing efforts to grow brand recognition.
Company-operated store gross profit was $0.8 million for the three-month period ended December 31, 2024, compared to $0.7 million for the comparable period in 2023. Q4'24 company-operated store gross margins decreased to 45% compared to 61% for the same period in 2023.
Company-operated store gross profit was $3.5 million for the year ended December 31, 2024, compared to $3.5 million for the comparable period in 2023. Full year 2024 company-operated store gross margins decreased to 63% compared to 66% for the same period in 2023.
Wholesale and online revenue for the fourth quarter of 2024 was ($9,878), compared to $177,365 in the fourth quarter of 2023. The decrease in revenue was due to B2B orders and a strategic shift in marketing focus toward in-store promotions, positioning the company for stronger omnichannel growth in 2025.
Total operating costs and expenses for the three-month period ended December 31, 2024, were $3.5 million compared to $3.0 million for the comparable period in 2023. Total operating costs and expenses for the year ended December 31, 2024, were $10.5 million compared to $10.1 million for the comparable period in 2023, representing an increase of 5%.
Net loss for the fourth quarter of 2024 was $1.8 million, compared to a net loss of $1.7 million for the fourth quarter of 2023. Net loss for the year ending December 31, 2024, was $4.8 million, compared to a net loss of $4.7 million for the year ending December 31, 2023.
Net cash used in operating activities for the year ended December 31, 2024, was $3.5 million, compared to $3.2 million for the year ended December 31, 2023.
Cash and cash equivalents totaled $0.2 million as of December 31, 2024, compared to $0.2 million as of December 31, 2023. On February 6, 2025, the Company entered into a securities purchase agreement and a common stock purchase agreement for up to a total of $60 million in financing commitments with Arena Investors, LP ("Arena") and Arena Business Solutions Global SPC II, Ltd. ("ABS").
About Reborn Coffee
Reborn Coffee, Inc. (NASDAQ: REBN) is focused on serving high quality, specialty-roasted coffee at retail locations, kiosks, and cafes. Reborn is an innovative company that strives for constant improvement in the coffee experience through exploration of new technology and premier service, guided by traditional brewing techniques. Reborn believes they differentiate themselves from other coffee roasters through innovative techniques, including sourcing, washing, roasting, and brewing their coffee beans with a balance of precision and craft. For more information, please visit www.reborncoffee.com.
Forward-Looking Statements
All statements in this release that are not based on historical fact are "forward-looking statements." While management has based any forward-looking statements included in this release on its current expectations, the information on which such expectations were based may change. Forward-looking statements involve inherent risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements, as a result of various factors including those risks and uncertainties described in the Risk Factors and Management's Discussion and Analysis of Financial Condition and Results of Operations sections of our recent filings with the Securities and Exchange Commission ("SEC") including our Form 10-K year ended December 31, 2024, which can be found on the SEC's website at www.sec.gov. Such risks, uncertainties, and other factors include, but are not limited to, the Company's ability to continue as a going concern as indicated in an explanatory paragraph in the Company's independent registered public accounting firm's audit report as a result of recurring net losses, among other things, the Company's ability to successfully open the additional locations described herein as planned or at all, the Company's ability to expand its business both within and outside of California (including as it relates to increasing sales and growing Average Unit Volumes at our existing stores), the degree of customer loyalty to our stores and products, the fluctuation of economic conditions, competition and inflation. We urge you to consider those risks and uncertainties in evaluating our forward-looking statements. We caution readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Contacts
Investor Relations Contact:
Chris Tyson
Executive Vice President
MZ North America
REBN@mzgroup.us
949-491-8235
Company Contact:
Reborn Coffee, Inc.
ir@reborncoffee.com
REBORN COFFEE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
December 31, December 31,
2024 2023
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 158,215 $ 164,301
Accounts receivable, net of
allowance for doubtful
accounts of $0 and $0,
respectively 67,309 56,938
Inventories, net 169,615 185,061
Prepaid expense and other
current assets 467,613 359,124
----------- -----------
Total current assets 862,752 765,424
Property and equipment, net 4,080,004 3,494,050
Operating lease right-of-use asset 2,653,179 4,566,968
Other assets 193,188 425,712
----------- -----------
Total assets $ 7,789,123 $ 9,252,154
=========== ===========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable $ 558,444 $ 632,753
Accrued expenses and current
liabilities 774,826 611,290
Loans payable to financial
institutions, current 111,300 791,352
Loans payable to others 427,073 609,027
Loans payable to shareholders - 100,000
Loan payable, emergency injury
disaster loan (EIDL), current 30,060 30,060
Loan payable, payroll
protection program $(PPP.UK)$,
current 37,494 45,678
Operating lease liabilities,
current 844,177 1,003,753
----------- -----------
Total current liabilities 2,783,374 3,823,913
Loans payable to financial
institutions, net of current - 335,147
Loan payable, emergency injury
disaster loan (EIDL), net of
current 469,940 469,940
Loan payable, payroll
protection program (PPP), net
of current 26,307 51,595
Operating lease liabilities,
net of current 1,906,760 3,725,153
----------- -----------
Total liabilities 5,186,381 8,405,748
----------- -----------
Commitments and Contingencies
Stockholders' equity
Common Stock, $0.0001 par
value, 40,000,000 shares
authorized; 4,274,508 and
1,866,174 shares issued and
outstanding at December 31,
2024 and 2023, respectively 428 187
Common stock issuable, $0.0001
par value, 294,000 shares
issuable at $5.00 per share 1,470,000 -
Preferred Stock, $0.0001 par
value, 1,000,000 shares
authorized; no shares issued
and outstanding at December
31, 2024 and 2023,
respectively - -
Additional paid-in capital 22,674,095 17,603,143
Accumulated deficit (21,562,872) (16,756,924)
Accumulated other comprehensive
income (loss) 21,091 -
----------- -----------
Total stockholders' equity 2,602,742 846,406
----------- -----------
Total liabilities and
stockholders' equity $ 7,789,123 $ 9,252,154
=========== ===========
REBORN COFFEE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Years Ended December 31,
----------------------------
2024 2023
-------------- -----------
Net revenues:
Stores 5,573,247 5,266,783
Wholesale and online 355,286 241,356
---------- ----------
Total net revenues 5,928,533 5,508,139
---------- ----------
Operating costs and expenses:
Product, food and drink costs -
stores 2,062,460 1,782,681
Cost of sales--wholesale and online 142,114 105,714
General and administrative 8,343,505 8,162,523
---------- ----------
Total operating costs and
expenses 10,548,079 10,050,918
---------- ----------
Loss from operations (4,619,546) (4,542,779)
---------- ----------
Other income (expense):
Other income (expense) 55,140 (8,942)
Asset impairment loss (25,602) -
Loss on the sale of building - (36,094)
Interest expense (215,140) (129,480)
---------- ----------
Total other expense, net (185,602) (174,516)
---------- ----------
Loss before income taxes (4,805,148) (4,717,295)
Provision for income taxes 800 7,828
---------- ----------
Net loss $ (4,805,948) $(4,725,123)
---------- ----------
Loss per share:
Basic and diluted $ (1.66) $ (2.86)
========== ==========
Weighted average number of common
shares outstanding:
Basic and diluted 2,896,960 1,652,034
---------- ----------
REBORN COFFEE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years Ended December 31,
----------------------------
2024 2023
-------------- -----------
Cash flows from operating
activities:
Net loss $ (4,805,948) $(4,725,123)
Adjustments to reconcile net loss
to net cash provided by (used in)
operating activities:
Stock compensation 600,061 285,000
Stock issued for services 187,152 -
Operating lease (64,180) 256,618
Depreciation 391,263 262,019
Changes in operating assets and
liabilities:
Decrease (increase) in accounts
receivable (10,371) (56,158)
Decrease (increase) in
inventories 15,446 (52,718)
Decrease (increase) in other
assets, net 124,035 (71,822)
Increase (decrease) in accounts
payable (53,218) 544,944
Increase (decrease) in accrued
liabilities, net 163,536 378,237
---------- ----------
Net cash used in operating
activities (3,452,224) (3,179,003)
---------- ----------
Cash flows from investing
activities:
Acquisition of property and
equipment (1,109,374) (2,413,257)
Proceeds from disposal of assets 132,157 -
---------- ----------
Net cash used in investing
activities (977,217) (2,413,257)
---------- ----------
Cash flows from financing
activities:
Proceeds from issuance of common
stock 4,283,980 -
Proceeds from common stock issuable 1,470,000
Repayent of borrowings from
shareholder (100,000) -
Proceeds frm loan payable to others (181,954) -
Proceeds frm line of credit - 1,000,000
Repayent of loan payable, PPP (33,472) -
Proceeds from loan payable to
financial institutions - 1,784,628
Repayments of loan payable to
financial institutions (1,015,199) (47,102)
---------- ----------
Net cash provided by financing
activities 4,423,355 2,737,526
---------- ----------
Net increase (decrease) in cash (6,086) (2,854,734)
Cash at beginning of year 164,301 3,019,035
---------- ----------
Cash at end of year $ 158,215 $ 164,301
========== ==========
Supplemental disclosures of non-cash
investing and financing activities:
Conversion of credit line to
common stock issuances $ - $ 1,000,000
========== ==========
Supplemental disclosure of cash flow
information:
Cash paid during the years for:
Interest $ 215,000 $ 129,000
========== ==========
Income taxes $ 800 $ 800
========== ==========
(END) Dow Jones Newswires
March 31, 2025 17:00 ET (21:00 GMT)
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