Rising profit spurs SodaStream to seek global acquisitions

SodaStream International, maker of machines that carbonate water, intends to acquire companies and beef up marketing internationally.

CEO Daniel Birnbaum said that the world’s biggest sodawater company sold 3-million units in the past 12 months, boosting its customer base 4% from the end of 2016, to 11.5million households, .

With about $100m in cash and no debt, SodaStream is planning to spend to keep the momentum going. “We’re on the offensive now,” Birnbaum said in an interview at SodaStream’s headquarters in Airport City, in Israel.

“We can buy companies, we can advertise more aggressively. We’re growing.” He did not say which businesses SodaStream was targeting.

SodaStream’s willingness to spend reflects how far it has advanced since switching strategies in 2014. With sales and income flagging, the company moved away from athome machines that competed in a $260bn market against giants such as Coca-Cola and PepsiCo. Sceptical investors punished the stock, which bottomed out in February 2016.

Then with the shift to sparkling water, SodaStream’s profit almost quadrupled in 2016. Its US-traded shares surged 342% from a recent low.

Birnbaum plans to focus the company’s efforts in places such as the US, Japan and Australia.

SodaStream expected sustained growth across Europe, which accounted for about twothirds of sales, he said.

Such reliance on Europe had hit SodaStream when it lost about $50m in sales in 2014 and 2015 as the euro lost 22% of its value versus the greenback, said Birnbaum.

“We learned our lesson from that,” he said. SodaStream now endeavoured more to link operating costs to the country of sales, Birnbaum said.

SodaStream’s chief has been waiting for a strong pick-up in environmentally conscious consumerism in the US, which investors have identified as the company’s next big opportunity.