US-based Black Rifle Coffee has released new financial targets for the next three years, with growth expected to slow in 2025.
The Utah-headquartered business looks to achieve a three-year compound annual growth rate ranging from 10-15% by 2027.
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This equates to “somewhere between $525m and $600m”, the group’s chief financial officer, Steve Kadenacy, said during an ICR Conference this week.
In its presentation to investors, Black Rifle said it expected a “lower rate of growth in 2025”, attributed to “slotting fees” from the launch of its four-strong line-up of energy drinks rolled out this year.
Higher growth rates are predicted for 2026 and 2027, as the coffee and energy drinks maker starts to see “ongoing benefits from distribution gains take effect”.
In September, the group signed a distribution deal with energy drinks major Keurig Dr Pepper (KDP) to sell and distribute its Black Rifle Energy RTDs.
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By GlobalDataKDP was expected to sell and distribute the Black Rifle Coffee RTD product within the “majority of its company-owned direct store territories” in the US.
The energy range consists of: Freedom Punch, Wild Frost, Ranger Berry and Project Mango. All are low-calorie and low-sugar drinks, containing 200mg of caffeine per 16 fluid-ounce can.
Black Rifle also looks to record a CAGR in adjusted EBITDA of 15-25% compared to 2024, and is targeting a gross margin above 40% “over time”, Kadenacy said.
However, the margin is expected to be pressured to around 30% in 2025, again driven by slotting fees from the energy drinks launch, as well as inflation in green coffee prices.
The group reaffirmed its guidance for its 2024 fiscal year, expecting to book net revenue ranging from $390m to $395m, a gross margin of 40–42% and adjusted EBITDA of around $35m to $40m.
In its most recent results released in November for its third quarter 2024, the group booked net revenue of $98.2m, a 2% drop year-on-year. Gross profit increased 21% to $41.3m.
The gross margin was up 8.2 percentage points at 42.1%. Adjusted EBITDA increased by $0.9m to $7.1m.
In a note to clients following the ICR conference, William Blair analysts predicted 2024 EBITDA of $37m and projected an 11% increase to $41m for 2025.
The analysts added: “Our thesis is that Black Rifle has the potential to become a billion-dollar brand with 20%-plus annual sales growth over a multi-year period, aided by brand momentum, distribution expansion in its wholesale business, and more outpost locations over time.
“Risks include brand perceptions, execution (wholesale, retail), and a competitive category.”
