Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

New Leaf Brands, Inc: A Few Minutes with CEO, Eric Skae

 A few days ago, New Leaf Brands, Inc. (OTCBB: NLEF) reached another milestone by signing on their 100th distributor. I spoke with Eric Skae, the CEO and founder of New Leaf, on Tuesday evening about the rapid growth of his company and would like to share portions of our conversation with all of you. Those of you that follow me know that I don’t pull a lot of punches when it comes to asking questions that need to be answered when researching a company trading on the “Over the Counter Bulletin Boards” (OTCBB). Mr. Skae is one of those Chief Executive Officers that I genuinely enjoyed the conversation.
I was interested in Mr. Skae’s background and his leadership ability as CEO of the company. What I found out is that he has almost 20 years in the beverage industry including working for beverage beasts such as Arizona and Hansen (NASDAQ: HANS). During his time at Hansen, Eric was responsible for the “Energy” brand while he was serving as Vice President of national accounts, which soon became the “Monster” brand drink explosion that became a household name right after his departure. He was responsible in part for laying the pavement for the road to success of “Monster.” Starting slow at first to build the foundation for New Leaf Brands, Inc., he has now been working full-time on New Leaf Brands for the last two and a half years. Mr. Skae is more than experienced at how to “put the bottles on the shelf” (his words, not mine) and run the team and the company surrounding the actions.
So, just what has he done to “put the bottles on the shelf?” With their products now being dubbed “The Official Beverage of Taste”, the growth of the New Leaf distribution chain is rapidly expanding. Their products are now found in over 8,000 locations including restaurants, delis, health food stores and pizzerias. They are nationwide with United Dairy Farmers (NASDAQ:UDF) stores and now found in 33 different Traxx stores as well. As mentioned in the opening paragraph of this article, New Leaf has 100 different distributors moving their brand at this point.  The New Leaf brand is not just teas anymore either. Recently, they announced the release of their lemonade line of beverages to compliment their tea line. All of the New Leaf beverages are sweetened with 100% pure cane sugar and available in 14 different flavors. They also have patented their own high-visibility shelving units to display their drinks and have negotiated “prime” locations within customer’s sales floors. Details of the growth are seen in numbers such as with Manhattan Beer, the largest beverage distributor in the New York City metropolitan area. Starting at the bottom of the list with regards to volume of sales for Manhattan, New Leaf has already climbed to #8 on the distribution giant’s list. Let’s not forget the competition on that list. Manhattan distributes beer items, such as Coors, Labatts and Corona on that list along with many brands of single serve beverages like New Leaf and other wine, cider and water products. New Leaf has recently signed top-notch salesman, Tim Brown, who has 32 years experience in national accounts for beverage giant, Hudepohl-Schoenling/Tradewinds. Mr. Skae, when referencing Mr. Brown’s experience in the industry is quoted as saying “He is the most connected guy in the business. There isn’t anyone who knows more people than Tim.”
Also discussed were the nuts and bolts of shares of the company. Mr. Skae confirmed the share structure as being 66 million shares issued and outstanding with 19 million shares in the float. The numbers are rounded off for literary sake, but accurate. Yes, there were shares added last year, but with good cause. Unlike many OTC companies that do not use the monies generated from dilution in a positive manner, the balance sheets and corporate structure were “cleaned up” as debt was eliminated and existing warrants are now gone. The share structure is still in good shape for a company with the potential revenues that New Leaf has, in my opinion. Are more shares going to be issued? It is a definite possibility. The one thing that I enjoyed about my conversation with Eric was his sincerity and candor. I have spoken with countless CEO’s and investor relations personnel in my life and I have heard the “song and dance” about how it dilution won’t happen, but Mr. Skae was quite “matter-of-a-fact” about dealing with the question. Even with revenues coming in, New Leaf is growing at a rapid pace and not looking to slow down. The momentum of this growth requires capital and it may have to be obtained through share issuance. Mr Shae reiterated shareholder value as he has made sure that that share structure has not been decimated in the past and intends to keep it that way.
To sum up my conversation in one word: “impressive.” I mean this from every aspect. New Leaf Brands is heading the right direction with a strong management team guiding the reigns. When researching companies such as this, I look for a few things:
•Leadership and experience
•Product and the public’s desire for said product
•Sales management and team
•Share structure and planning for handling it for the future
My conclusion is that New Leaf Brands, Inc. is a company that is worthy of continued research and a good hard look as an investment. I invite all of you to perform due diligence and continue to dig deeper into this little gem of a company.


Disclaimer: At the time of penning this article, I own no shares of NLEF and have received no compensation for any of the information provided. All opinions expressed are purely my own. This article has been reviewed for accuracy by New Leaf Brands, Inc. prior to publication.

Disclosure: zero holdings