Although National Beverage Corp., the maker of LaCroix, has said that its target customer is “a cult-led, tech-charged millennial with ‘change’ power,” the company’s CEO is an 82-year-old billionaire whose press releases look like announcements for your dad’s company picnic, and whose haphazardly capitalized words will remind you of that man who describes himself as “your favorite president.”
Nick A. Caporella typed up one of those press releases on Thursday—complete with an American flag-and-Comic Sans combo at the top—and it was bonkers enough to make the company’s shares fall by 16 percent. And after all that, the Guggenheim investment firm has suggested that anyone who owns shares should just go ahead and sell them.
Caporella hasn’t had the best run of months lately (we’ll get to that), but he didn’t do himself, LaCroix, or National Beverage Corp. any favors when he said that “injustice” was the reason that its sales have dropped.
“We are truly sorry for these results stated above,” he said, after noting the company’s dismal third-quarter numbers. “Negligence nor mismanagement nor woeful acts of God were not the reasons—much of this was the result of injustice! Managing a brand is not so different from caring for someone who becomes handicapped. Brands do not see or hear, so they are at the mercy of their owners or care providers who must preserve the dignity and special character that the brand exemplifies.”
The press release concluded—as they always do—with the oddly punctuated phrases “I just Love my… LaCroix!!!” and “‘Patriotism’—If Only We Could Bottle It!”
Consumers may love LaCroix slightly less than they did a couple of years ago. According to CNBC, during the quarter that ended on January 26, National Beverage’s profit fell 39.6 percent and its revenue was down by 2.9 percent. (And that affects Caporella more than anyone: the Wall Street Journal says that he owns 73.5 percent of the company’s shares).
Last July, two pilots filed lawsuits against Caporella, alleging that he touched both of them inappropriately during more than 30 flights on the company’s jet. (One of the two men, Terence Huenefeld, ultimately reached a settlement with Caporella.)
In October, a class-action lawsuit alleged that LaCroix was labeled as “all-natural,” despite containing a number of synthetic chemicals—and a second, very similar lawsuit was filed in New York in January. In response to the first lawsuit, Caporella compared LaCroix’s supporters to a cult (in a good way, I guess?) and he issued a statement calling the second plaintiffs “professional liars” who had used social media to “falsely attack our brand integrity.”
So yeah, it could be “injustice” that has called the stocks to fall, or it could be some of Caporella’s questionable statements, or his alleged questionable behavior or, as Guggenheim said, just growing competition from brands like Topo Chico and Pepsi’s Bubly sparkling water and the freshly launched seltzer lines of pretty much every beverage company out there. But keep talking, Nick, it seems to be going great.
UPDATE 2/20/20: The class-action suit regarding LaCroix's usage of artificial ingredients has been retracted and dropped by lead plaintiff Lenora Rice and her law firm. In the retraction, Rice and her law firm admitted that the testing of LaCroix conducted by their hired laboratory made no findings that LaCroix contained any artificial ingredients.