Good morning and welcome to the Celsius Holdings Transaction Investor Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press Star followed by the number one on your telephone keypad. Thank you. I will now hand the call over to Paul Wiseman, Investor Relations. Please go ahead. Good morning and thank you for joining today's webcast. With me today are John Fieldly, Chairman and CEO, Jarrod Langhans, Chief Financial Officer, and Toby David, Chief of Staff. We'll take questions following the prepared remarks. A press release related to today's conference call was issued this morning and is also available on our website, ir.celsiusholdingsinc.com. An audio replay of this webcast will also be accessible later today. Today's discussion includes forward-looking statements based on our current expectations and information. These statements involve risks and uncertainties, many beyond the company's control. Celsius Holdings disclaims any duty to update forward-looking statements except as required by law. Please review our Safe Harbor statements and risk factors in today's press release and in our most recent filings with the SEC, which contain additional information and a description of risks that may result in actual results differing materially from those contemplated by our forward-looking statements. With that, I'll turn the call over to John. Thank you, Paul. Good morning, everyone, and thank you for joining us. Today marks an important milestone for Celsius Holdings. We've announced a significant expansion of our long-term strategic partnership with PepsiCo, an agreement that strengthens our alignment, broadens our portfolio, and positions us to create value for shareholders, customers, and consumers over the long term. Under the terms announced today, Celsius Holdings has been named PepsiCo's strategic energy drink captain in the U.S. This role deepens our partnership, fully aligns incentives, and unifies the go-to-market strategies across our energy portfolio. Our Alani Nu brand will transition into PepsiCo's leading U.S. and Canada distribution system. This shift is expected to expand Alani Nu's geographic reach, increasing its availability across retail, and opens the brand up into new channels, particularly food service and convenience. Celsius Holdings also agreed to acquire Rockstar Energy brand in the U.S. and Canada from PepsiCo. Rockstar brings classic energy flavors and format that is complementary to our performance-forward Celsius and modern lifestyle Alani Nu brand. As consideration for the agreements, PepsiCo has received $585 million in newly issued convertible preferred stock, raising its ownership stake in Celsius Holdings to approximately 11% on an as-converted basis and gaining an additional board seat. The steps create near and long-term opportunities for Celsius Holdings. First, it provides Celsius Holdings with strategic control over the allocations of the Celsius Holdings portfolio of Celsius, Alani Nu, and Rockstar Energy brands, and over their energy platforms, planograms, SKU prioritizations, and promotional strategies, including certain priority periods. Becoming PepsiCo's U.S. strategic energy drink captain is a pivotal milestone. It strengthens our relationships, brings greater alignment, and allows us to lead with a unified commercial strategy across the Celsius Holdings portfolio. We believe this role will enhance category productivity for retail customers and deepen Celsius' position as a leader in modern energy. Second, Alani Nu has quickly become the fastest-growing brand in modern energy. By moving into PepsiCo's distribution system, Alani Nu is positioned to achieve meaningful ACV expansion and accelerate its food service presence. We expect this transition will broaden Alani Nu's availability and further its appeal to young, female, and wellness-focused consumers. Third, adding Rockstar strengthens our portfolio and expands our consumer reach. With Celsius and Alani Nu as the growth engines and Alani Nu extending into lifestyle and wellness, Rockstar allows us to serve the large traditional segment of the energy drink category. Our approach will be disciplined, stabilizing the brand, rationalizing SKUs, and building on the brand's rich heritage. Certain PepsiCo employees who work on the Rockstar Energy brand will transition to Celsius Holdings, giving us unity and brand experience. Fourth, PepsiCo's alignment with the additional investment of $585 million in equity and the additional board seat demonstrates their long commitment to Celsius. This expanded alignment strengthens our governance and further aligns our strategies. I'll now hand it over to Jarrod to deliver remarks on the financial elements of the transaction. Jarrod? Thanks, John. Good morning, everyone, and thank you for joining us with such short notice. Before John closes out our prepared remarks, I wanted to walk through some of the timing components of the transaction. We signed and closed all agreements. In addition to the Alani distribution agreement, the captaincy agreement, the preferred share issuance, and the Rockstar acquisition, we have entered into a transition services agreement as well as a manufacturing agreement at the PepsiCo manufacturing facilities that manufacture Rockstar Energy product. These agreements will have different components that will be in place from one to seven months. The accounting for the transition services will be like what we did with Alani in that we will pay a monthly rate while utilizing the transition services until we effectively transition off of the services being provided. Examples of such services would be working with our teams to transition key account calls, managing e-commerce, and assisting with back shop support. As it relates to the manufacturing agreements, we will utilize a variety of models as we transition Rockstar into our Orbit structure, so there will be some noise in the system over the next three to four months. As we are likely to get modeling questions, I'd like to note that our intention is to transition a majority of the Alani Nu DSD to the Pepsi distribution system as of December 1st. As a result, we would only have one month of activity with Alani in the Pepsi system prior to year-end. If we were to just look at Celsius and Alani, we wouldn't expect to see much change in Q3 relative to what we discussed on our call earlier in the month. As it relates to Q4, we will continue to have tariff pressure, as previously discussed, and I would expect to see some inventory write-offs and scrap as we do the transition into the Pepsi system, resulting in some additional pressure on margins. If you look back to our comments when we moved into the Pepsi system with Celsius, you'll see that we had a similar outcome in which we increased some of our inventory reserves and write-offs as a result of the transition. Moving to Rockstar, we will only have one month of activity in Q3. In looking at the business as a brand separated from PepsiCo, we are looking at something like $250 million+ in annual sales to add to our portfolio, and therefore we wouldn't recommend any significant changes to models for Q3. We will provide additional color on our Q3 earnings call in relation to Q4. Let me provide a bit more detail on the financial impact. PepsiCo's $585 million preferred stock investment increases their stake in Celsius to about 11% on an as-converted basis and allows them to nominate a representative for a second board seat. This is a strong endorsement of our long-term strategy. The new preferred stock carries a 5% dividend consistent with their prior investment. Importantly, the structure is designed to maintain our flexibility while aligning PepsiCo's interests with our performance. From a financial standpoint, we expect this transaction to be accretive to cash EPS in the first full year. We also expect distribution to expand meaningfully as Alani Nu transitions into PepsiCo's system and Rockstar Energy is integrated into our portfolio. Our balance sheet remains strong with the liquidity to support integration and continued investment in growth, as well as debt reduction. Let me now turn it over to John for some closing remarks. Thank you, Jarrod. This is an exciting next step for Celsius Holdings and PepsiCo. We step into the role of PepsiCo's U.S. energy captain, bringing new influence and alignment across the portfolio. Alani Nu will enter PepsiCo's distribution system, unlocking its next phase of growth. Rockstar broadens our consumer reach, while Celsius and Alani Nu remain the engines of modern energy growth. PepsiCo increased investment in the second board seat strengthens our strategic alignment for the long term. Together, this agreement currently creates a 20% share portfolio in the U.S. energy drink category, expands our reach to more consumers in more places more often, and positions Celsius Holdings for sustained growth in years ahead. I want to thank our employees, our partners at PepsiCo, and our shareholders for their continued support. We are excited about what lies ahead. With that, Jarrod and I will take questions. Turn it back to the operator. At this time, if you would like to ask a question, press Star, then the number one on your telephone keypad. To withdraw your question, simply press Star, one again. We kindly ask that you limit yourself to one question for today's call. We will pause for just a moment to compile the Q&A roster. Your first question comes from the line of Peter Grom with UBS. Please go ahead. Thanks, operator, and good morning, everyone. Congrats on the news this morning. One thing I was hoping to get some perspective on as it relates to the transaction, just on what being the strategic energy drink captain for Pepsi means and what this may unlock as you look ahead. Any broad thoughts in terms of whether having control of the entire portfolio may do in terms of improving execution, shelf space, just relative to what we've seen over the last several years. Thanks. Yeah, absolutely, Peter. Thank you. The captaincy really allows us to have more of a strategic control over the portfolio and planograms and the go-to-market strategies. It really, really aligns the synergies that Celsius and PepsiCo have on our go-to-market strategies. When you look at kind of within different markets, within different channels, we're able to make sure we have the best planogram and the best flavors and SKUs within those locations to drive the optimal sales performance. A strategically aligned SKU prioritization, promotional strategies, and then priority periods as well throughout the year truly deepens the overall long-term partnership that we have within PepsiCo. I think it really positions us for continued growth, especially with the incorporation of the Alani portfolio and then the opportunities we have with Rockstar. Great. Thanks so much. I'll pass it on. Your next question comes from the line of Kevin Grundy with BNP Paribas. Please go ahead. Great. Thanks. Good morning, everyone, and congratulations on the deal. Could you maybe comment on the deal structure, which I think in some ways maybe to many is a bit reminiscent of the Coke and Monster deal from over a decade ago? Maybe just comment on why this was the right structure. Comment why perhaps just a distribution deal more similar to what you have currently with Celsius and the Pepsi system, why taking on the Rockstar brand, which has struggled for a very long time, as you guys know, as part of the consideration, why that was appropriate. Thank you. Yeah, no, absolutely. I think what this does is it really lands on a few things. When you look at the overall thesis and the agreements, I talked about the captaincy before as an important aspect, the additional investment within the organization and the additional enhancement of the board seat just further aligns Celsius strategically with PepsiCo, provides us a unified front and a better collaboration as we continue to move forward. I think it's a really good model, somewhat similar, you could say, to Monster and Coke, and it seems to be a proven model for them as well. We're really excited about the future together. The more we can further collaborate, better execution, better prioritization, the category continues to grow in scale. We see great opportunities that this category is not planned to slow down at all. With our modern portfolio and the enhancements of it with Rockstar coming on the portfolio, we're able to offer it to a much broader consumer base and really optimize our planograms going forward to capture the greatest share and dollars in revenue. I'll jump in on the queue Thank you. Yeah. From the way it was structured is we will be moving Alani into the Pepsi distribution system to join Celsius and Rockstar for a full portfolio. As a part of that, Pepsi will fund the termination fees of the moving out of the current distribution system and into their distribution system. We will be acquiring the Rockstar brand in the U.S. and Canada. We've already talked about kind of the captaincy concept. We also have some other ancillary things like transition services and manufacturing agreements and things like that. In terms of that, what Pepsi is getting is that we are going to extend the preferred A's to mirror what we're calling the preferred B's. The preferred B's will be $585 million of value through convertible preferred stock. The preferred A's remain what they were. You'll have a strike price on the preferred A's at $25, a strike price on the preferred B's at $51.75. They'll have the same features that the preferred A's had back when we set them up in 2022 with the six-year automatic convert and then the seven-year conversion feature as well. Very good. Thank you, guys. Good luck. Thank you. Your next question comes from the line of Robert Moskow with TD Cowen. Please go ahead. Hi, thanks, and congratulations. I wanted to know, you know, the retail data for Rockstar Energy indicates $600 million in retail sales. You described $250 million to your P&L. Can you help us explain the difference between those two? Is there going to be some rationalization for Rockstar? Absolutely. Great question, Robert. We do anticipate some rationalization within the portfolio. There's a big opportunity there. We're going to continue to optimize. We anticipated that into our numbers as we're anticipating that SKU rationalization to take place as we're entering in and going through resets for 2026. Yeah, you got to remember where we are on the cycle. There's the retailer, there's the distributor, and then there's the brand. Just like if you look at Celsius last year, I think the scanner data was something like $2.7 billion, and we were around $1.4 billion. There is going to be somewhat of a delta. The $250+ million is kind of a pro forma number that we came up with. It's not exact because it's pulling the number out of the Pepsi system and then saying, you know, roughly what do we think we'll get in net promos and contra revenue and things like that. It was a ballpark number. That's why we just called out roughly $250+ million. Okay, and just one quick follow-up. What can you do to mitigate any kind of friction or noise during this transition away from the current distribution network and into yours? Normally, there's some either risk of inventory loading or loss of sales. Yeah, I mean, Robert, we worked with our partners, mainly the ABI distributors. They're great partners, great executors, and we have good working relationships with all of our customers and distribution partners, and they supported the transition of Celsius into the network, and we expect the same. We have our SOPs, our processes, and our oversight with all of our team members that have experience doing this. We're going to continue to work through this extremely diligently to mitigate any impact on that. We have controls in place and oversight to try to limit that as much as possible. Okay, thank you. Your next question comes from the line of Camille Godrualo with Jefferies. Please go ahead. Hey, everybody. Good morning and congratulations. I guess the first question is making sure I understand what sort of captaincy means. Does that also mean exclusivity? The captaincy piece is an incentive program that aligns strategic initiatives and really revolves around the strategic alignment within being the strategic energy drink captain lead over planograms within energy of the Celsius Holdings portfolio, as well as enhanced priority periods and further collaboration strategically within the PepsiCo organization. Okay, got it. All right, we'll figure that out. On the sort of the decision to go this route versus leaving the brands where they were, can you maybe just walk through all the things that you guys were working through and where the real background of the decision-making process is? Thanks. Yeah, I'll touch highly on that. I mean, the strategic decision is really around not only, you know, when you look at synergies, the opportunities of running and really collaborating, working with one network, just the opportunities of additional adjacent categories with, you know, expanding Alani distribution, not only to all of the independent channels, but also food service, the breadth and depth of distribution, and the support within the world-class PepsiCo distribution network. We have a lot of capabilities and alignment within our sales organizations. We really have tied into Pepsi, not only from a sales and organizational standpoint, but also from our supply chain standpoint as well as we continue to drive efficiencies, which you started to see that in our gross profit margins over the last several quarters as well. It has a variety, not only from an operational go-to-market commercial reasonings, but also from a financial reasoning as we continue to optimize, driving greater shareholder value. Got it. Thank you. Your next question comes from the line of Jim Salera with Stephens. Please go ahead. Jonathan and Jarrod, good morning. Thanks for taking our question. I want to dig into how you guys are thinking about what Rockstar adds to the portfolio. Obviously, around the Alani Nu acquisition, you guys have really emphasized, you know, female focus, and that opens up kind of the new consumer cohort. Did the Rockstar brand bring anything that you've been unable to access with the Ceslus and the Alani brands, or is it going to kind of fit more of a niche consumer appeal? Jarrod, I appreciate all the thoughts around the transition services and manufacturing agreements. Once we move past that, just any thoughts around long-term margin profile for Rockstar Energy relative to Alani Nu and the core Celsius brand? Yeah, I'll take the part of that, Jim. I mean, when you look at the Rockstar portfolio, it does really well in the Pac Northwest. That has historically been more of a weaker area for our portfolio. That does open that up as opportunities to leverage our total portfolio and continue to build in the Pac Northwest. Also, if you look at Rockstar, it's more of a traditional energy drink offering with traditional flavors. That is an area that, between Celsius and Alani, that is not our core consumer base. It does broaden our portfolio. It broadens our breadth and opens us up for a total portfolio approach as we continue to execute within these divisions of Pepsi and particular markets. We were able to customize our portfolio to drive the greatest velocities, the greatest revenues for the consumer base that is in those particular markets. It really gives us additional levers to pull and strategic opportunities for our commercial teams. Jarrod? Yeah, I guess in terms of kind of a margin profile, as we're going through the TSA, we're not going to be able to see some of the benefits that we'll see once we get it fully integrated into our sales infrastructure, our commercial infrastructure, and our operations infrastructure within our six-orbit model. You're probably looking more like a margin profile back in kind of 2020, 2021, 2022 with Celsius that'll then migrate to the 2023, 2024, 2025 over a period of time, somewhere in the 12- 18 month timeframe. I appreciate the thoughts. I'll come back to you. Your next question comes from the line of Michael Labory with Piper Sandler. Please go ahead. Thank you. Good morning. Just was wondering if you could give us any update on what Alani transitioning into Pepsi might mean for, you know, an update to the synergy figure you'd been given around the deal previously, and if there's any incentive changes or updates that come with the new arrangement compared to where you were previously. Yeah, I think we're not going to make any forward comments today, but you know, we're excited about the opportunity. When you look at where Celsius was entering the PepsiCo distribution system and you look at where Alani Nu is, it's a little bit further developed than when Celsius went into the PepsiCo distribution network. You know, there's a lot of opportunities within additional channels, small format, convenience, and the food service opportunities. We're not going to provide any forward information, but we're going to maximize the value we can with our total portfolio approach, working closely with PepsiCo. Is the incentive terms the same as they were with just brand Celsius, or is there any change when you bring Alan in now? It's restructured from the incentive, so it's more tied around the captaincy and the unified strategy, commercial strategy going forward, and really expanding and tightening the partnership. It restructured to be more favorable? You've got three brands into it now. Okay, thanks so much. Your next question comes from the line of Andrea Teixeira with JPMorgan. Please go ahead. Thank you, guys. Good morning and congrats again. Just as you mentioned broadly, now that you revised the terms of the distribution, now obviously three brands over one brand before. I was hoping if you can give us comfort on how this distribution transition will be less disruptive than before. Going back, in the beginning of the call, you said that there would be some inventory reserves and write-offs that are obviously part of the deal into the fourth quarter. How can we think about those impacts and any pull forward as the ABI distributors had, I mean, anything that we're seeing here? Obviously, the numbers for Alani are fantastic in the track channel data, but just thinking if there were any shipment dynamics we should be aware of ahead of the transition or anything to note. Just as we think about valuation for the deal, the $585 million, just thinking of the synergies and all of that, how can we think about the increasing stake and what it means in terms of valuation against all being said and done against post synergies this deal came out at? We can do obviously EBIT sales, but in terms of EBITDA or profitability, it's hard to gauge the valuation metrics. Thank you for all of those. Yeah. Just to start off with the first one, the disruption that you mentioned with the Celsius distribution moving into and integrating into PepsiCo. We actually were told the opposite. It's one of the best transitions that they've seen. Quite frankly, we've received a lot of positive feedback from our distributors on how professional we handled that transition. I would expect this Alani transition to be held and transferred in the same manner with great commercial oversight, business acumen, and execution. We feel confident in that. As I talked about, we have processes and procedures, and we're excited about the opportunity. We really appreciate all of the ABI distributors out there for all their support and what they've done. When Jarrod mentions write-offs, we did see some inventory write-offs when we entered into the PepsiCo system, and you will have some. There are different pack sizes. There are some residual products as you continue as you're transitioning. We do expect that, and it'll probably be somewhere similar to what we saw within the Celsius portfolio on the transition. It won't be material, not extremely material, but there will be some write-downs that take place. In regards to Alani, it's done phenomenal, extremely well. This Witch's Brew that just launched most recently within the quarter as a limited-time offering has just extremely performed. The flavor profile is great. The social media, the look and feel, the excitement that's taken place within the product has really, really done phenomenal. We have more LTOs coming for the back half, not only on Alani, but also within the Celsius portfolio, where we'll be launching our first LTO for the first time. I think when you're looking at pipe fills, looking at what you should experience, once again, we don't provide forward-looking information, but I would go back to 2022. You can kind of see some of the pipe fills we experienced within the Celsius portfolio. We would expect something similar, but we'll know more as we continue to progress. Thank you for all your questions. That concludes our question- and- answer session. I will now turn the call back over to John Fieldly for closing remarks. Thank you, everyone, for joining the call on such short notice. We're excited, and thank you for joining us today for the continued support in Celsius Holdings. We're proud of the progress we've made, energized by the next chapter with PepsiCo, and we're confident in our ability to drive long-term growth and value. We look forward to updating you on the momentum and the quarters ahead. Go grab a CELSIUS and live fit and enjoy the long weekend. Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect.