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Market Overview

Demand for Functional Beverages Grows as Consumer Shift Towards Healthy Choices

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NEW YORK, December 13, 2018 /PRNewswire/ --

Millions of consumers drink some sort of beverage on a daily basis, whether it's nonalcoholic, carbonated, energy supplementing or health drinks. Companies need to keep pace with changes in consumer choices as they explore new drinks within the market, creating a diverse portfolio of options for consumers. According to data compiled by Grand View Research, the global nonalcoholic beverage market was valued at USD 967.3 Billion in 2016 and is expected to reach USD 1.60 Trillion by 2025. Additionally, the market will grow at an estimated CAGR of 5.8% over the forecast period. Rising societal awareness towards health concerns is one of the biggest drivers for the beverage market as now, more consumers are looking for calorie-free or low-calorie drink options. Koios Beverage Corp. (OTC: KBEVF), GNC Holdings, Inc. (NYSE:GNC), New Age Beverages Corporation (NASDAQ:NBEV), The Coca-Cola Company (NYSE:KO), Keurig Dr Pepper Inc. (NYSE:KDP)

New product launches and wide selections have enabled consumer growth around the globe. A diverse portfolio of options has also helped companies expand to other demographics and regions. However, regardless of the large selection of drinks, functional beverages are expected to emerge as the fastest growing product in the industry. Specifically, functional drinks such as ready to drink coffees and teas, relaxation and energy drinks are in high demand. According to the Natural Product Insider, Christina Wood, Sales and Marketing Director at OptiBiotix Health Plc, credited the advances in science for helping the market grow "from its early stages of vitamin- or energy-boosting refreshments to offer reliable health-management tools." Wood also acknowledged consumers are at the center of the category's growth. "Busier lifestyles are driving the need for convenient preparations that allow people to manage well-being on the move." Specifically, she said consumers are looking for "options featuring natural ingredients such as tea extracts and bacterial strains," and that the products serve a wide variety of wellness needs. "Whether vitamin or 'enhanced' water to fend off illness, energy drinks to combat fatigue or sports drinks to aid exercise, they provide the multipurpose value expected by today's informed."

Koios Beverage Corp. (OTC: KBEVF) is also listed on the Canadian Securities Exchange under the ticker (CSE:KBEV). Earlier this week, the Company announced breaking news that, "it has signed a vendor agreement with GNC Holdings, Inc. (GNC), a leading global health and wellness brand with thousands of retail stores across the U.S. and Canada.

"We are incredibly pleased to be working with GNC on a national rollout of our ready-to-drink line," said CEO Chris Miller. 'Improving the quality of peoples' lives is a shared principle between us and we look forward to eventually adding value to GNC customers across the globe. The added revenue growth could be substantial and a catalyst for hitting our projected growth targets in the coming years.'

Pittsburgh-based GNC has more than 6,400 retail locations throughout the United States and Canada and franchise operations in approximately 50 international markets. GNC Canada is based in Mississauga, Ontario and operates as a subsidiary of GNC. It is well known as a go-to source for health, wellness and sports nutrition.

GNC sets the standard in the nutritional supplement industry-demanding truth in labeling, ingredient safety and product potency, all while remaining on the cutting-edge of nutritional science. As the company has grown over the years, so has its commitment to living well.

"GNC is one of the largest and best-known nutritional companies in the world. Working with them is a tremendous honour and something we have envisioned since our inception," said Miller. "From scientific research and new product discovery to the manufacturing and packaging processes, GNC takes pride in its rigorous approach to ensuring quality. We are incredibly confident we can deliver the best products in their category and look forward to tremendous growth opportunities with our new partner in the years to come. Koios is expected to be available in the United States by Q1 of 2019."

GNC Holdings, Inc. (NYSE:GNC) is a global health and wellness brand that helps people live well. GNC Holdings, Inc. recently announced the grand opening of its experiential store in South Hills Village Shopping Center in Pittsburgh, Pa. The new store will incorporate several unique offerings to allow consumers to customize their wellness regimen. "Becoming a one-stop shop for all health and wellness needs, the store will offer several installations, including: GNC Smoothie Lab: Order delicious and healthy drinks, grab-and-go snacks and other prepared meals made with high-quality ingredients and top GNC products at the GNC Smoothie Lab; Body Composition Analysis: Step onto the InBody Body Composition Analyzer to gain insights on your health and find the right solutions for your lifestyle; Registered Dietitian Consultations: The in-house dietitian will be available to provide free consultations to help you develop a customized plan tailored to your specific health goals. "This experiential store represents the continuous innovation and consumer-focused mindset that is the foundation of GNC," said Joe Gorman, EVP of Operations at GNC. "We are focused on providing a personalized approach to wellness and now GNC consumers have the opportunity to experience this firsthand and connect with us in a truly customized way."

New Age Beverages Corporation (NASDAQ:NBEV) is a Colorado-based healthy beverage company focused on inspiring, educating, and hydrating consumers. New Age Beverages Corporation recently announced the signing of a definitive agreement to acquire Morinda Holdings, Inc., a Utah-based healthy lifestyles and beverage company with operations in more than 60 countries around the world. The newly combined global company will be headquartered in Denver, Colorado with major operations in Shanghai, Tokyo, Munich, Utah, and more than 20 other countries, and further strengthens New Age with the infrastructure to expand its portfolio of healthy beverages worldwide. Consideration for the transaction will be USD 85 Million, comprised of USD 75 Million in cash and USD 10 Million in New Age restricted stock based on the 40-day volume-weighted average price from closing. The cash consideration for the transaction will be sourced from New Age's current cash balance. The transaction is expected to close in late December. Kerry Asay, Chief Executive Officer of Morinda commented, "We are so excited to be combining with New Age. When we envisioned what we could achieve with New Age's portfolio through our system, we knew how transformative it could be for all our employees and independent distributors around the world. I have guided Morinda since its creation for the past 22 years, and am so proud of what we have accomplished. I am highly confident that Brent will lead our company to even greater heights, and I am very excited to become a shareholder of New Age. Now as a public company, with all the resources that Morinda will bring to the integrated Company, we see tremendous potential for all our employees, independent distributors and shareholders for growth and significant wealth creation."

The Coca-Cola Company (NYSE:KO) is a total beverage company, offering over 500 brands in more than 200 countries and territories. The Coca-Cola Company recently announced that it had reached a definitive agreement to acquire Costa Limited, which was founded in London in 1971 and has grown to become a major coffee brand across the world. The acquisition of Costa from parent company Whitbread PLC is valued at USD 5.1 Billion and will give Coca-Cola a strong coffee platform across parts of Europe, Asia Pacific, the Middle East and Africa, with the opportunity for additional expansion. Costa operations include a leading brand, nearly 4,000 retail outlets with highly trained baristas, a coffee vending operation, for-home coffee formats and Costa's state-of-the-art roastery. The acquisition will expand the existing Coca-Cola coffee lineup by adding another leading brand and platform. The portfolio already includes the market-leading Georgia brand in Japan, plus coffee products in many other countries. "Costa gives Coca-Cola new capabilities and expertise in coffee, and our system can create opportunities to grow the Costa brand worldwide," said Coca-Cola President and Chief Executive Officer James Quincey. "Hot beverages is one of the few segments of the total beverage landscape where Coca-Cola does not have a global brand. Costa gives us access to this market with a strong coffee platform."

Keurig Dr Pepper Inc. (NYSE:KDP) is a leading coffee and beverage company in North America, with annual revenue in excess of USD 11 Billion. Keurig Dr Pepper recently announced the successful completion of the merger between Keurig Green Mountain and Dr Pepper Snapple Group. The transaction creates the seventh-largest company in the U.S. food and beverage sector and third-largest beverage company in North America, with annual revenues of approximately USD 11 Billion. Commenting on the announcement, Keurig Dr Pepper Chief Executive Officer Bob Gamgort stated, "The combination of these two great companies creates the scale, portfolio and selling and distribution capabilities to compete differently in the beverage industry. With a large stable of iconic brands and the leading single-serve coffee brewing system on the market, KDP has the ability to satisfy any beverage need or consumption occasion-hot or cold, at work or at play, at home or on the go-and the capability to get our brands to consumers virtually anytime and anywhere they purchase beverages. I am honored to lead this great team and excited that together we will challenge this industry in a new way."

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