Good day, and welcome to the Monster Beverage Company first quarter 2022 conference call. All participants will be in listen only mode. Should you need assistance, please signal the conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I'd now like to turn the conference over to Rodney Sacks and Hilton Schlosberg. Please go ahead. Thank you. Good afternoon, ladies and gentlemen. Thank you for attending this call. I'm Rodney Sacks. Hilton Schlosberg, our Vice Chairman and Co-Chief Executive Officer, is on the call, as is Thomas Kelly, our Chief Financial Officer. Thomas Kelly will now read our cautionary statement. Before we begin, I would like to remind listeners that certain statements made during this call may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are based on currently available information regarding the expectations of management with respect to revenues, profitability, future business, future events, financial performance and trends, as well as the future impact of the COVID-19 pandemic on the company's business and operations. Management cautions that these statements are based on our current knowledge and expectations and are subject to certain risks and uncertainties, many of which are outside the control of the company, that may cause actual results to differ materially from the forward-looking statements made during this call. Please refer to our filings with the Securities and Exchange Commission, including our most recent annual report on Form 10-K filed on February 28, 2022, including the sections contained therein, Risk Factors and Forward-Looking Statements, for a discussion on specific risks and uncertainties that may affect our performance. The company assumes no obligations to update any forward-looking statements, whether as a result of new information, future events or otherwise. I would now like to hand the call over to Rodney Sacks. Thank you. The company achieved record first quarter net sales of $1.52 billion in the 2022 first quarter, 22.1% higher than net sales of $1.24 billion in the 2021 comparable period. As in recent quarters, to meet increased demand for our products rather than experience out of stocks for certain lines at retail, the company incurred operational inefficiencies in the United States and in various countries, resulting in increased costs. During the 2022 first quarter, the company continued to procure additional quantities of aluminum cans from suppliers in the United States and abroad in response to increased consumer demand. In the first quarter of 2022, the company experienced significant increases in cost of sales relative to the comparative 2021 first quarter, primarily due to increased freight rates and fuel costs, including costs relating to the importation of aluminum cans, as well as aluminum can costs attributable to higher aluminum commodity pricing. The company also experienced a significant increase in ingredient and other input costs, secondary packaging materials, co-packing fees, and production inefficiencies. The company continued to experience additional global supply chain challenges, including the lack of adequate shipping containers and port congestion, which resulted in shortages of certain ingredients and finished products. This necessitated the company airfreighting substantial quantities of certain ingredients internationally, particularly to EMEA, Asia Pacific, and Latin America, at additional costs and inefficiencies. Furthermore, the company experienced significant increases in distribution expenses, including increased fuel, freight, and warehousing costs, which adversely impacted operating expenses. The company continued to address the challenges in its supply chain as it navigates through the uncertainty of the current global supply chain environment. In the United States, the company secured additional co-packing capacity to meet increased demand for certain of its products. The company estimates that approximately $46 million of costs in the quarter were the result of operating inefficiencies, due in part to strong consumer demand, including the importation of aluminum cans, as well as COVID-19 related issues such as port congestion, shortage of shipping containers resulting in the need to airfreight ingredients, which the company continues to address. In addition, increased commodity and raw materials costs, including aluminum, other ingredient costs and secondary packaging incurred during the quarter, amounted to approximately $45 million, and increases in freight rates and fuel impacted gross profits by approximately $6 million. Gross profit as a percentage of net sales for the 2022 first quarter was 51.1%, compared with 57.5% in the 2021 first quarter. The decrease in gross profit percentage for the 2022 first quarter was primarily the result of the items mentioned previously, as well as geographical sales mix. Additionally, GAAP requires a fair value step-up of the CANarchy inventories of $3.8 million, which, together with expenses related to the acquisition of CANarchy of $4.2 million during the quarter, adversely affected both gross margins and operating expenses. The decrease in gross profit as a percentage of net sales for the 2022 first quarter was partially offset by pricing actions. Operating expenses for the 2022 first quarter were $377.2 million compared with $300.8 million in the 2021 first quarter. As a percentage of net sales, operating expenses for the 2022 first quarter were 24.8% compared with 24.2% in the 2021 first quarter. Distribution expenses for the 2022 first quarter increased to $81.4 million, which is an increase of 49.7% or 5.4% of net sales, compared to $54.4 million or 4.4% of net sales in the 2021 first quarter. The $27 million increase in distribution expenses was primarily due to increased freight out costs of $20.6 million as a result of higher outbound freight rates and fuel, increased volume and out-of-orbit freight, as well as higher warehouse expenses of $6.4 million as a result of higher raw material and finished good product inventories in the United States and EMEA. We believe that a portion of the increase in distribution expenses that we experienced in the quarter are likely to be transitory. The increase in other operating expenses was primarily due to increased expenditures for travel and entertainment, increased payroll expenses, increased professional services expenses, including accounting and legal expenses, increased commissions, and increased sponsorships and endorsements. During the comparative 2021 first quarter, the company decreased expenditures for travel and entertainment as well as our marketing programs, largely as a consequence of the COVID-19 pandemic. The impact of the COVID-19 pandemic was less pronounced on such expenses during the 2022 first quarter. Operating expenses as a percentage of net sales for the 2022 first quarter were 24.8% as compared to operating expenses as a percentage of net sales for the 2019 first quarter pre-COVID, which was 27.7%. Our two new suppliers of aluminum cans in the United States are now operational. As a result, we are able to decrease our reliance on the use of imported aluminum cans in the United States. In the United States, we anticipate seeing a reduction in cost of sales related to the use of imported aluminum cans in the latter half of 2022. Although we expect to reduce the importation of aluminum cans into EMEA in the second half of 2022, we will only see a reduction in cost of sales after we have worked through current inventories of imported cans in EMEA. We rebuilt and increased finished product inventory levels across the United States and EMEA to reduce excessive cost of long-distance freight to satisfy demand and to return to our orbit strategy of producing in closer proximity to our customers. The costs of repositioning finished products to distribution centers are included in freight-in costs. Operational income. Operating income for the 2022 first quarter - 3.5% to $399.5 million from $414.1 million in the 2021 comparative quarter, primarily due to the company's operations in EMEA and Asia Pacific. Net income - 6.7% to $294.2 million as compared to $315.2 million in the 2021 comparable quarter. Diluted earnings per share for the 2022 first quarter - 6.8% to $0.55 from $0.59 in the first quarter of 2021. Through pricing actions during the quarter, the company was able to record positive pricing actions in excess of 3% in the United States and in EMEA. Due to continued cost pressures, the company is planning for a net sales price increase in the range of 6% market-wide in the United States effective September 1, 2022. The company is also monitoring the opportunity for additional pricing actions internationally as well as in the United States. According to the Nielsen reports for the 13 weeks through April 23, 2022, for all outlets combined, namely convenience, grocery, drug, mass merchandisers, sales in dollars in the energy drink category, including energy shots, increased by 11.5% versus the same period a year ago. Sales of the company's energy brands, including Reign, were up 8.6% in the 13-week period. Sales of Monster were up 10.6%, sales of Reign were down 6.1%, sales of NOS - 3.5%, and sales of Full Throttle + 5.5%. Sales of Red Bull + 7.8%. Sales of Rockstar + 5.4%, sales of 5-hour - 1.2%, and VPX Bang sales - 8.1%. The sales growth of the Monster brand exceeded that of Red Bull in the period. According to Nielsen, for the four weeks ended April 23, 2022, sales in dollars in the energy drink category in the convenience and gas channel, including energy shots in dollars, + 3.8% over the same period the previous year. Sales of the company's energy brands, which include Reign, + 4.8% in the four-week period in the convenience and gas channel. Sales of Monster increased by 5.7% over the same period versus the previous year. Reign sales - 2%. NOS was down 2.3%, and Full Throttle was up 7.1%. Sales of Red Bull were down 0.4%. Rockstar was down 1.7%. 5-hour ENERGY was down 5.2%, and VPX Bang sales decreased by 11.7%. According to Nielsen, for the four weeks ended April 23, 2022, the company's market share of energy drink category in the convenience and gas channel, including energy shots in dollars, + 0.4 of a point to 37.5%. Monster share + 0.6 share points to 31.6%. Reign share - 0.1 of a share point to 2.4%. NOS share - 0.2 points to 2.6%, and Full Throttle share remained at 0.7%. Red Bull share - 1.5 points to 35.3%. Rockstar share was down 0.2 points to 3.6%. 5-hour Energy share was lower by 0.4 of a point to 4.4%, and VPX Bang share - 1.2 points to 6.6%. According to Nielsen, for the four weeks ended April 23, 2022, sales in dollars of the coffee plus energy drink category, which includes our Java Monster line in the convenience and gas channel, - 5.3% over the same period the previous year. Sales of Java Monster, including Java Monster 300 and Java Monster Nitro Cold Brew, were 2.4% higher in the same period versus the previous year. Sales of Starbucks Energy were 11.7% lower. Java Monster share, including Java Monster 300 and Java Monster Nitro Cold Brew of the coffee plus energy category, which primarily included Java Monster, Java Monster 300, Java Monster Cold Brew, Starbucks Doubleshot and Tripleshot, Rockstar Roasted, and Bang Keto Coffee for the four weeks ended April 23, 2022, was 55.3%, up 4.2 points, while Starbucks Energy share was 42.9%, down 3.1 points. According to Nielsen, in all measured channels in Canada for the 12 weeks ended March 26th, 2022, the energy drink category + 13.5% in dollars. Sales of the company's energy drink brands + 11.6% versus a year ago. The market share of the company's energy drink brands was 41.5%, down 0.7 points. Monster sales + 13.3%, and its market share remained at 37.1%. NOS sales - 12.8%, and its market share - 0.4 of a point to 1.5%. Full Throttle's sales - 14.9%, and its market share - 0.2 of a share point to 0.05 share points. According to Nielsen, for all outlets combined in Mexico, the energy drink category + 25.4% for the month of March 2022. Monster sales + 28.9%. Monster's market share in value + 0.8 of a share point to 28.3% against the comparable period the previous year. Sales of Predator + 67%, and its market share + 0.9 of a share point to 3.7%. The Nielsen statistics for Mexico cover single months, which is a short period that may often be materially influenced positively and/or negatively by sales in the OXXO convenience chain, which dominates the market. Sales in the OXXO convenience chain, in turn, can be materially influenced by promotions that may be undertaken in that chain by one or more energy drink brands during a particular month. Consequently, such activities could have a significant impact on the monthly Nielsen statistics for Mexico. According to Nielsen, for the month of March 2022 compared to March 2021, Monster's retail market share in value decreased in Argentina from 45.2% - 45%. Monster Energy continues to be the leading energy brand in value in Argentina. According to Nielsen, for the month of March 2022 compared to March 2021, Monster's retail market share in value increased in Brazil from 34.9% - 40.2%. Monster is now the leading energy brand in value in Brazil, marking another important milestone for our brand in South America. In Chile, Monster's retail share for the month of March 2022 decreased from 40% - 36.3% due to a shortage of shipping containers. Our bottler in Chile is in the process of validating its new production line in order to increase our in-country production. I would like to point out that the Nielsen numbers in EMEA should only be used as a guide because the channels read by Nielsen in EMEA vary from country to country and are reported on varying dates within the month referred to from country to country. According to Nielsen, in the 13-week period ending April 2, 2022, Monster's retail market share in value as compared to the same period the previous year grew from 14.7% - 16.2% in Germany. Monster's retail market share in value as compared to the same period the previous year declined from 20.7% - 20.3% in South Africa. According to Nielsen, in the 13-week period ending March 27, 2022, Monster's retail market share in value as compared to the same period the previous year grew from 25.5%-27.1% in Denmark. From 31.9%-32.1% in France, from 27.9%-29.3% in Great Britain, from 27.2%-27.6% in Norway, from 18.1%-21.4% in Poland, from 36%-37.8% in Spain, and from 14.9%-15.9% in Sweden. Monster's retail market share in value as compared to the same period the previous year declined from 15.2%-14.9% in Belgium, from 8.1%-7.9% in the Netherlands, and from 28%-27.9% in the Republic of Ireland. According to Nielsen, in the 13-week period ending February 27, 2022, Monster's retail market share in value as compared to the same period the previous year grew from 15.8%-17.7% in the Czech Republic, from 37.2%-38.3% in Greece, and from 27%-27.6% in Italy. According to Nielsen, in the 13-week period until the end of February 2022, Predator's retail market share in value as compared to the same period the previous year grew from 14.5%-23.3% in Kenya and from 3.3%-14.7% in Nigeria. According to IRI in Australia, Monster's market share in value for the month ending April 10, 2022 increased from 13%-13.6% as compared to the same period the previous year. Mother's market share in value decreased from 11.5%-10.4% during the same period. The market share of the company's brands in Australia for the month ended April 10, 2022 decreased from 24.5%-24%. According to IRI in New Zealand, Monster's market share in value for the four weeks ended April 17, 2022 increased from 12.7% - 12.9% as compared to the same period the previous year. Live+'s market share in value decreased from 6.4% - 6.1%, and Mother's market share in value increased from 5.6% - 5.7%. The market share of the company's brands in New Zealand for the four weeks ended April 17, 2022 remained at 24.7%. According to INTAGE in Japan, in the last month ending March 2022, Monster's market share in value in the convenience store channel as compared to the same period the previous year grew from 50.1% - 52.5%. According to Nielsen in South Korea in the last month ending March 2022, Monster's market share in value in all outlets combined as compared to the same period the previous year grew from 54.8% - 59.4%. We again point out that in certain market statistics that cover single months or four-week periods may often be materially influenced positively and/or negatively by promotions or other trading factors during those periods. Net sales to customers outside the U.S. were $553.4 million, 36.4% of total net sales in the 2022 first quarter, compared to $459.4 million or 36.9% of total net sales in the corresponding quarter in 2021. Foreign currency exchange rates had a negative impact on net sales in US dollars by approximately $32.9 million in the 2022 first quarter. Included in reported geographic sales are our sales to the company's military customers, which are delivered in the U.S. and trans-shipped to the military and their customers overseas. In EMEA, net sales in the 2022 first quarter + 21.8% in dollars and + 30% in local currencies over the same period in 2021. Gross profit in this region as a percentage of net sales for the first quarter was 29.6% compared to 37.3% in the same quarter in 2021. Gross profit in the first quarter was impacted by higher aluminum commodity pricing, increased freight for imported cans, increased raw material and ingredient costs, as well as air freight costs. The company is continuing to address the controllable challenges in its supply chain in EMEA. We are also pleased that in the 2022 first quarter, Monster gained market share in the Czech Republic, Denmark, France, Germany, Great Britain, Greece, Italy, Norway, Poland, Spain, and Sweden. In Asia Pacific, net sales in the 2022 first quarter + 1.9% in dollars and + 9.4% in local currencies over the same period in 2021. Gross profit in this region as a percentage of net sales was 40.9% versus 48.8% over the same period in 2021. In Japan, net sales in the 2022 first quarter - 5.8% in dollars, but + 3.4% in local currency. Sales decreased over the same period in 2021, largely due to COVID-19 restrictions in Japan. In South Korea, net sales + 71.7% in dollars and 86.1% in local currency as compared to the same quarter in 2021. Monster remains the market leader in Japan and South Korea. In China, net sales - 8.9% in dollars and 10.8% in local currency as compared to the same quarter in 2021, largely impacted by COVID-related lockdowns. We remain optimistic about the prospects for the Monster brand in China. In Oceania, which includes Australia, New Zealand, Tahiti, French Polynesia, New Caledonia, Papua New Guinea and Guam, net sales - 13.8% in dollars and 7.9% in local currencies. Sales in Australia and New Zealand were negatively impacted by shipping delays of certain flavors, concentrates and ingredients. Furthermore, sales in Australia were also impacted by severe flooding in that country in the 2022 first quarter. In Latin America, including Mexico and the Caribbean, net sales in the 2022 first quarter + 52.5% in dollars and + 59.7% in local currencies over the same period in 2021. Gross profit in this region as a percentage of net sales was 35.4% for the 2022 first quarter versus 37.9% in the 2021 first quarter. In Brazil, net sales in the 2022 first quarter increased by 72.1% in dollars and 67.4% in local currency. Net sales in Mexico + 37.7% in dollars and 41.4% in local currency in the 2022 first quarter. Net sales in Chile + 28.4% in dollars and 45.5% in local currency in the 2022 first quarter. Net sales in Argentina + 103.1% in dollars and 146.4% in local currency in the 2022 first quarter. I will now discuss our litigation with Vital Pharmaceuticals, Inc., which I will refer to as VPX, the maker of Bang energy drinks. In June 2020, Monster Energy Company, which I will refer to as MEC, and Orange Bang, Inc., a family-owned beverage business and the rightful owner of several trademark registrations to the Bang marks, initiated an arbitration against VPX. MEC and Orange Bang allege that VPX breached a 2010 settlement agreement with Orange Bang that restricted VPX's use of the Bang trademark to products that are creatine-based or marketed and sold only in nutritional channels, as well as claims that VPX infringed Orange Bang's trademark rights to the Bang marks. In April 2022, the arbitrator issued a final award finding in favor of MEC and Orange Bang on all claims. The arbitrator found that VPX's Bang energy drinks, which VPX advertises containing super creatine and other Bang branded products, do not contain creatine and do not provide the benefits of creatine. Because Bang branded products are thus not creatine-based and are not limited to nutritional channels, the arbitrator found they are being sold in breach of the settlement agreement. The arbitrator also found that VPX's Bang branded products infringe Orange Bang's trademarks. The arbitrator awarded MEC and Orange Bang $175 million to remedy VPX's past misconduct and attorney's fees and costs, which amounted to nearly $9.3 million. The arbitrator also ordered VPX to pay MEC and Orange Bang an ongoing 5% royalty on all future net sales of Bang products. Pursuant to the terms of the agreement between MEC and Orange Bang, the award and future royalties will be shared equally between MEC and Orange Bang. Under the arbitrator's order, if VPX fails to pay the royalty, VPX is prohibited from using the Bang mark, subject to certain limited exceptions. MEC and Orange Bang have filed a motion to confirm the arbitrator's award. VPX has filed a motion to vacate the arbitration award. A hearing on VPX's motion is scheduled for June 27, 2022. MEC's lawsuit against VPX for false advertising, unfair competition, and misappropriation of trade secrets in the Central District of California is still pending, with trial scheduled to begin in August 2022. As this litigation and other pending proceedings with VPX are sub judice, we will not be answering any questions on those matters in today's call. In January 2022, we introduced our first 16 oz Ultra variety 12 packs, which are being well received by consumers, and we are continuing to expand our multipack portfolio in the 2022 first quarter. In February 2022, we introduced new flavor innovations with Ultra Peachy Keen, Juice Monster Aussie Style Lemonade, Rehab Watermelon, and Reignbow Sherbet. In February 2022, we launched our newest brand nationally, True North Pure Energy Seltzer in four 12 oz flavors through the Coca-Cola distribution network. At the end of the 2022 first quarter, we launched two new ready-to-drink nitro-infused coffee products, Java Monster Cold Brew Latte and Java Monster Cold Brew Sweet Black. In Canada, in January 2022, we introduced Monster Ultra Gold. In February 2022, we grew Canada's Reign portfolio by launching Reign White Gummy Bear. We successfully launched several new products across Latin America in the first quarter of 2022. In Argentina, we launched VR46 The Doctor. In Chile, we expanded our Reign line by launching Reign Melon Mania, Lemonheads, and Monster Energy Orange Dreamsicle. In Mexico, we launched our second Predator SKU with Predator Mean Green. We also launched Monster Ultra Gold in Puerto Rico and Monster Mango Loco in Colombia. In the 2022 first quarter, we launched Monster Ultra Gold and Mother Kiwi Sublime in Australia and New Zealand. We launched our third Super Fuel flavor in Tropical Thunder. In EMEA, in the first quarter of 2022, we launched Monster Mule, Monster Nitro, and Monster Assault in a number of countries. We also launched Ultra Fiesta, Watermelon and Gold, and Juiced Monarch, Khaotic and Pacific Punch in a number of countries during the 2022 first quarter. During the 2022 first quarter, we also launched Predator and Reign in additional countries. During the first quarter of 2022, we launched Monster Pipeline Punch in Singapore. We also introduced the Predator brand in India. In April 2022, we launched Monster Mango Loco in Japan. We are planning to introduce the Predator brand in several additional countries in APAC in the course of 2022. Our co-packing network is an integral part of the company's production model, which we intend to preserve. The owner of one of the co-packing facilities with which we contracted, located in Norwalk, California, announced earlier this year that they would be selling this facility and ceasing its operations at this facility. To maintain adequate supply of the company's products, we have acquired the associated real property, leases, and equipment of this co-packing facility for a purchase price of $62.5 million. Following the purchase, the facility will be closed for a period of time before the company is able to commence production. We estimate April 2022 sales, including CANarchy, to be approximately 6.7% higher than in April 2021 and 4.8% higher than in April 2021, excluding CANarchy. On a foreign currency adjusted basis, excluding CANarchy, April 2022 sales would have been approximately 7.7% higher than the comparable April 2021 sales. April 2022 had one less selling day compared to April 2021. We mentioned that April 2022 sales had a challenging hurdle to meet over April 2021 sales. You may recall that in our 2021 first quarter conference call to shareholders, we estimated that April 2021 sales were approximately 71.3% higher than in April 2020. Please keep in mind that the comparative 2022-2020 sales were materially adversely impacted by the COVID-19 pandemic. In our 2021 first quarter conference call to shareholders, we estimated that April 2020 sales were 22.2% lower than our April 2019 sales. April 2021, April 2020 and April 2019 all had the same number of selling days. The company had sufficient can capacity and co-manufacturing filling capacity across all regions to address demand for April. In this regard, we caution again that sales over a short period are often disproportionately impacted by various factors, such as, for example, selling days of the week in which holidays fall, timing of new product launches, and the timing of price increases and promotions in retail stores, distributor incentives, as well as shifts in the timing of production. In some instances, where our bottlers are responsible for production and unilaterally determine their production schedules, which affect the dates on which we invoice such bottlers, as well as inventory levels maintained by our distribution partners, which they alter unilaterally for their own business reasons. We reiterate that sales over a short period, such as a single month, should not necessarily be imputed to or regarded as indicative of results for a full quarter or any future period. If the COVID-19 pandemic and related unfavorable economic conditions continue in certain regions, our new product innovation launches in those regions could be delayed. In conclusion, I would like to summarize some recent positive points. The company continues to address challenges in its supply chain by sourcing cans and primary ingredients and blends, increasing its manufacturing capacity and increasing finished product inventories. This should enable us to improve our service levels and lower transportation costs across North America, EMEA and LATAM. Our AFF flavor facility in Ireland is now providing a large number of flavors to our EMEA region, enabling better service levels and lower landed costs to our EMEA region. We are pleased with the new additions to the Monster Energy portfolio. We are planning to continue additional launches of our Reign Total Body Fuel high-performance energy drinks in additional international countries. We are pleased with the rollout of Predator and Fury, our affordable energy drink portfolio internationally. We are proceeding with plans to launch our affordable energy brands in an additional number of international countries. We are enthusiastic about the opportunities that CANarchy presents. While we believe that we will be able to address many of the supply chain challenges we have faced, we anticipate still having to face certain ongoing challenges in the future. I would now like to open the floor to questions about the quarter. Thank you. We will now begin the question-and-answer session. To ask a question, you may press star, then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two. In the interest of time, we ask that you limit yourself to one question. At this time, we'll pause momentarily to assemble our roster. Our first question comes from Dara Mohsenian from Morgan Stanley. Please go ahead. Afternoon. Hi, Dara. Your U.S. sales continue to come in very strong again this quarter and show a sustained decoupling versus the scanner data, implying obviously very strong growth in the untracked channels. Can you just review for us what level of growth you're seeing in those untracked channels? What are the key drivers behind it? Then as we think about the U.S. going forward? Can you discuss your thoughts on potential Monster top line weakness or category weakness if we do see a consumer spending slow down, and if you think we've seen any demand impact so far from higher gas prices? Thanks. Dara, turning to your first question, you know, there's always a disconnect between our sales, which are sales in the main to distributors, and as well, we sell obviously to some direct accounts, including the untracked channels. It's really difficult for us to get that information to this investor group. All I can say is there will always be a disconnect. Nielsen is not a true indication even for sales through the distributor system because there are lags in the distribution system as well. Turning to your second question about gas prices. You know, we've seen this before. We've seen gas prices moving up, and we've seen you know sales of energy drinks really staying the course. At the end of the day, remember that we have a business that is based on a brand that is a lifestyle brand. Consumers purchase the Monster products because it's part of what they believe to be, and it's what they want to be. It's not something that's necessarily that price sensitive, and that made us kind of feel confident about our decision to take up pricing later this year. We already took pricing up, as we mentioned, through pricing actions, and we will be taking pricing up effective September 1. The only thing I would maybe could add just one from one aspect. Traditionally, the convenience channel was growing, you know, more quickly for the energy category than the mainstream grocery and drug channels. You know, in recent quarters, that has had been reversed with less lower driving through COVID, and then you've got higher gas prices. I mean, at the moment, if you look at the latest four weeks or one week numbers, the convenience channel is growing less than if you look at, you know, the all measure channels. I think that, you know, that's something that we've managed to achieve the results we have, you know, despite that and despite the fact that in fact, you know, convenience is our largest channel, which I just think, you know, is positive for the future because we think that will right itself eventually when gas prices, you know, sort of normalize and/or people just get used to the gas prices and becomes whatever the level is, people will get used to it eventually and continue to drive. You know, if you look, for example, at the last two weeks, Nielsen, for, in convenience, April 16th, we're seeing Nielsen sales, in convenience, for the energy category growing at 4.8%. We're seeing the following week, which is April 23, which is what we discussed on this call, convenience in that one week growing 7%. You know, it's the market will continue to grow. As I said earlier, Monster is an affordable luxury, and we don't anticipate at this time seeing a dramatic fall off in sales in the convenience and gas channel. Our next question comes from Andrea Teixeira from JP Morgan. Please go ahead. Thank you, operator, and good afternoon. Rodney, on the 6% price increase starting September in the U.S., I'm assuming that's on top of the 3% average that you had in Q1. Is that across all products and channels or balanced with RGM? What are you hearing from retailers in terms of competitors following or not? That price increase is an addition to the pricing actions that we took in the first quarter that we started taking in the last quarter of 2021 and will continue through this year. We have taken pricing actions. We'll continue to take pricing actions. September 1, there'll be a market-wide increase. You know, we said approximately 6%, depending on you know, on channel. So far, we have not heard any rumblings from competitors about what they're doing and what they're not doing. We haven't heard anything from retailers. You know, as I said on a previous call, we're running our own brand irrespective of the competitors. We believe in the power of our brand, and we have strong brands, and we believe that, you know, this pricing action is justified, and it's certainly justified in terms of all the costs that we are seeing the cost increases, and no doubt our competitors are seeing the same cost increases. Our next question comes from Bonnie Herzog from Goldman Sachs. Please go ahead. All right. Thank you. Good afternoon. So you guys called out certainly many pressures this quarter impacting your business to really fill the strong underlying demand. Yet, you know, I just, you know, wanted to circle back because I thought you guys had made some progress in some of the, you know, the distribution inefficiencies such as maybe already, you know, purchasing more supply in the U.S. during the quarter as well as, you know, had started to operate back within your orbit. Maybe touch on that for us, please. Then Rodney, can you help us understand, you know, maybe where things stand now as it relates to some of these pressures? You know, have they already started to ease? You mentioned a few things, but, you know, just trying to confirm that you've already seen improvement or is it really gonna take until the second half until we see improvements on your gross margins? Finally, I'd be curious to hear how much stronger, you know, your sales might have been in the quarter if you could have supplied enough product to fill the strong consumer demand. If you could quantify that for us, that would be helpful. Thanks. Okay. Well, let me just deal with the first part of your question, Bonnie, and then, you know, we can obviously get Rodney's input on the rest. You know, as we look at the quarter, remember the Ukraine conflict started on February the 24. We had a dramatic increase in fuel prices, which, you know, we really didn't forecast. And we also had a dramatic increase in aluminum prices. And, you know, if you just look at aluminum prices, aluminum, the commodity, went up 65% in Q1 2022 versus the previous year, Q1 2021. There were unexpected issues that surfaced in the quarter. I think we said at the time that we were building up inventories and that's what we've been doing. We've absolutely been building up inventories in the quarter, and you'll see that reflected in our balance sheets. We're probably in a good position now, better than we have been in terms of supply. As we also said on this call is that April we did not have a shortage of containers or product to any significant degree. You know, we as well-placed as we have been in the past to satisfy demand. The next question comes from Kevin Grundy from Jefferies. Please go ahead. Great. Thank you guys. Good afternoon. Two if I could, just to come back to the 6% pricing, which is certainly a step in the right direction, but not nearly enough to cover the inflationary pressures that you've seen over the past couple of years. Maybe just comment on the magnitude of it, how you arrived at that, and why you believe that's the appropriate number. With respect to the April sales update, not to overweight at any one given month, your point on the comparison is entirely fair, but anything that you're seeing within the business that gives you any concern about underlying demand. It certainly doesn't sound that way, but I just wanted to ask given the step down from what we saw from very strong results in the quarter. Thank you for that, guys. You know, remember the hurdle we had in 2021. That was you know, probably one of the biggest hurdles we've seen. I think that you know, April as we've always said you know, one month in isolation should not be construed as you know, as indicative of performance for a quarter or a longer period of time. The way we got to our price increases is, remember, we're already taking pricing actions and you know, we look at a whole bunch of factors, and there's a whole lot of factors that we take into account in determining where we should be. Obviously, price points are a big driver. you know, what we believe is fair and that the consumer will bear, that becomes a very big factor in assessing the price points and then, of course, assessing the extent of the price increase. The next question comes from Mark Astrachan from Stifel. Please go ahead. Yeah, thanks, and good afternoon, guys. I guess just a short question. Anything preventing the company from buying stock back once the quiet period post the Q filing is complete? No. No. It's a short answer. It's a short answer. We probably will be, you know, recommencing some buying activities. Lovely. Thank you. It's short question, short answer. This concludes our question and answer session. I would like to turn the conference back over to Rodney Sacks for any closing remarks. Thanks very much. On behalf of Monster, I'd like to thank everyone for their continued interest in the company. We continue to believe in the company and our growth strategy and remain committed to continue to innovate, develop, and differentiate our brands and to expand the company both at home and abroad, and in particular, to expand distribution of our products through the Coca-Cola bottling system internationally. We believe that we are well-positioned in the beverage industry and continue to be optimistic about the future of our company. We hope that you will stay safe and healthy. Thank you very much for your attendance. Conference is now concluded. 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