The Vita Coco Company Reports Strong First Quarter 2025 Financial Results
Vita Coco reported strong Q1 2025 financial results, with net sales increasing 17% to $131 million. The company's flagship Vita Coco Coconut Water showed impressive growth of 25% globally, with Americas growing 24% and International growing 36%.
Key financial highlights include net income rising by $5 million to $19 million, with earnings per diluted share of $0.31. Gross profit reached $48 million with a 37% margin. The company maintains a strong financial position with $154 million in cash and no debt.
For fiscal 2025, Vita Coco reaffirmed its outlook, projecting net sales between $555-570 million and Adjusted EBITDA of $86-92 million. The company's growth strategy includes the national rollout of Vita Coco Treats and continued expansion in key markets like the United States, United Kingdom, and Germany.
Vita Coco ha riportato solidi risultati finanziari nel primo trimestre del 2025, con un aumento delle vendite nette del 17% a 131 milioni di dollari. Il prodotto di punta dell'azienda, Vita Coco Coconut Water, ha registrato una crescita globale impressionante del 25%, con le Americhe in crescita del 24% e i mercati internazionali del 36%.
I principali indicatori finanziari evidenziano un incremento dell'utile netto di 5 milioni di dollari, raggiungendo 19 milioni, con un utile per azione diluito di 0,31 dollari. Il profitto lordo ha raggiunto 48 milioni di dollari con un margine del 37%. L'azienda mantiene una solida posizione finanziaria con 154 milioni di dollari in liquidità e nessun debito.
Per l'anno fiscale 2025, Vita Coco ha confermato le previsioni, prevedendo vendite nette tra 555 e 570 milioni di dollari e un EBITDA rettificato tra 86 e 92 milioni di dollari. La strategia di crescita dell'azienda include il lancio nazionale di Vita Coco Treats e l'espansione continua in mercati chiave come Stati Uniti, Regno Unito e Germania.
Vita Coco reportó sólidos resultados financieros en el primer trimestre de 2025, con un aumento de las ventas netas del 17% hasta 131 millones de dólares. El producto estrella de la compañía, Vita Coco Coconut Water, mostró un impresionante crecimiento global del 25%, con un aumento del 24% en las Américas y del 36% en los mercados internacionales.
Los principales indicadores financieros incluyen un incremento de 5 millones de dólares en el ingreso neto, alcanzando los 19 millones, con una ganancia por acción diluida de 0,31 dólares. El beneficio bruto llegó a 48 millones de dólares con un margen del 37%. La empresa mantiene una posición financiera sólida con 154 millones de dólares en efectivo y sin deuda.
Para el año fiscal 2025, Vita Coco reafirmó sus expectativas, proyectando ventas netas entre 555 y 570 millones de dólares y un EBITDA ajustado de 86 a 92 millones de dólares. La estrategia de crecimiento de la empresa incluye el lanzamiento nacional de Vita Coco Treats y la expansión continua en mercados clave como Estados Unidos, Reino Unido y Alemania.
Vita Coco는 2025년 1분기 강력한 재무 실적을 보고했으며, 순매출이 17% 증가하여 1억 3,100만 달러를 기록했습니다. 회사의 대표 제품인 Vita Coco Coconut Water는 전 세계적으로 25%의 인상적인 성장을 보였으며, 미주 지역은 24%, 국제 시장은 36% 성장했습니다.
주요 재무 하이라이트로는 순이익이 500만 달러 증가하여 1,900만 달러에 달했으며, 희석 주당순이익은 0.31달러입니다. 총이익은 4,800만 달러에 37%의 마진을 기록했습니다. 회사는 1억 5,400만 달러의 현금 보유와 무부채 상태로 강한 재무 건전성을 유지하고 있습니다.
2025 회계연도에 대해 Vita Coco는 순매출 5억 5,500만~5억 7,000만 달러와 조정 EBITDA 8,600만~9,200만 달러를 예상하며 전망을 재확인했습니다. 회사의 성장 전략에는 Vita Coco Treats의 전국 출시와 미국, 영국, 독일 등 주요 시장에서의 지속적인 확장이 포함됩니다.
Vita Coco a annoncé de solides résultats financiers pour le premier trimestre 2025, avec une augmentation des ventes nettes de 17 % à 131 millions de dollars. Le produit phare de la société, Vita Coco Coconut Water, a connu une croissance impressionnante de 25 % au niveau mondial, avec une croissance de 24 % dans les Amériques et de 36 % à l'international.
Les principaux faits financiers incluent une augmentation du revenu net de 5 millions de dollars, atteignant 19 millions, avec un bénéfice par action dilué de 0,31 dollar. Le bénéfice brut a atteint 48 millions de dollars avec une marge de 37 %. L'entreprise maintient une position financière solide avec 154 millions de dollars en liquidités et aucune dette.
Pour l'exercice 2025, Vita Coco a confirmé ses prévisions, projetant des ventes nettes comprises entre 555 et 570 millions de dollars et un EBITDA ajusté de 86 à 92 millions de dollars. La stratégie de croissance de la société inclut le déploiement national de Vita Coco Treats et une expansion continue sur des marchés clés tels que les États-Unis, le Royaume-Uni et l'Allemagne.
Vita Coco meldete starke Finanzergebnisse für das erste Quartal 2025, mit einem Anstieg der Nettoumsätze um 17 % auf 131 Millionen US-Dollar. Das Flaggschiff-Produkt des Unternehmens, Vita Coco Coconut Water, verzeichnete ein beeindruckendes globales Wachstum von 25 %, wobei die Amerikas um 24 % und der internationale Markt um 36 % wuchsen.
Wichtige finanzielle Highlights sind ein Anstieg des Nettogewinns um 5 Millionen auf 19 Millionen US-Dollar, mit einem verwässerten Gewinn je Aktie von 0,31 US-Dollar. Der Bruttogewinn erreichte 48 Millionen US-Dollar bei einer Marge von 37 %. Das Unternehmen hält eine starke finanzielle Position mit 154 Millionen US-Dollar in bar und keiner Verschuldung.
Für das Geschäftsjahr 2025 bestätigte Vita Coco seine Prognose und erwartet Nettoumsätze zwischen 555 und 570 Millionen US-Dollar sowie ein bereinigtes EBITDA von 86 bis 92 Millionen US-Dollar. Die Wachstumsstrategie des Unternehmens umfasst die landesweite Einführung von Vita Coco Treats und die fortgesetzte Expansion in Schlüsselmärkten wie den Vereinigten Staaten, dem Vereinigten Königreich und Deutschland.
- Net sales increased 17% to $131M in Q1 2025
- Vita Coco Coconut Water sales grew 25% globally
- Net income rose by $5M to $19M ($0.31 per share vs $0.24)
- Strong cash position with $154M and zero debt
- Board approved additional $25M for share repurchase program
- International market growth of 36%
- Americas market growth of 24%
- Gross margin declined to 37% from 42% YoY
- Higher ocean freight rates and finished goods costs
- SG&A expenses increased to $29M from $28M
- Inventory levels rose from $84M to $88M
Insights
Vita Coco reports strong Q1 with 17% revenue growth, 29% EPS increase, and expanded share buyback despite gross margin pressure.
Vita Coco's Q1 2025 results demonstrate robust growth momentum across key metrics. Net sales surged
While top-line growth impressed, the company faced margin compression with gross margin declining from
The company's financial position remains exceptionally strong with
Vita Coco has reinforced its 2025 outlook, projecting continued mid-to-high teens growth for its core coconut water business and expecting adjusted EBITDA between
The combination of accelerating revenue growth, improved profitability, and management's confidence demonstrated through maintained guidance and expanded share repurchases points to strong business fundamentals, despite the ongoing challenges with transportation and product costs.
Net Sales Increased
Net Income Increased
Company Reaffirms Full Year Outlook
NEW YORK, April 30, 2025 (GLOBE NEWSWIRE) -- The Vita Coco Company, Inc. (NASDAQ:COCO) (“Vita Coco” or “the Company”), a leading high-growth platform of better-for-you beverage brands, today announced financial results for the first quarter ended March 31, 2025.
First Quarter 2025 Highlights Compared to Prior Year Period
- Net sales increased
17% to$131 million . - Vita Coco Coconut Water net sales growth of
25% . - Gross profit was
$48 million , an increase of$1 million . - Gross margin was
37% of net sales compared to42% of net sales. - Net income was
$19 million compared to net income of$14 million . - Net income per diluted share was
$0.31 compared to$0.24 . - Non-GAAP Adjusted EBITDA1 was
$22.5 million compared to$21.2 million .
Michael Kirban, the Company's Co-Founder and Executive Chairman, stated, "I am very proud of our team and how we have started 2025. The coconut water category remains one of the fastest growing categories in the beverage aisle, showing strong growth in the United States, the United Kingdom and Germany, which produced
Martin Roper, the Company’s Chief Executive Officer, said, “Our exceptionally strong shipment performance in the first quarter benefited from very strong demand for Vita Coco Coconut Water, and great execution from our teams. Our full year expectations are based on delivering mid to high teens Vita Coco Coconut Water growth, and the national roll out of Vita Coco Treats, which started to appear on retail shelves late first quarter. We believe we have secured sufficient capacity to support our growth expectations, which should enable us to operate with some excess capacity during the second half of the year."
First Quarter 2025 Consolidated Results
Net sales increased
Gross profit increased to
Selling, general and administrative ("SG&A") expenses were
Net income was
Non-GAAP Adjusted EBITDA1 was
Balance Sheet
As of March 31, 2025, the Company's financial position remained strong with cash and cash equivalents of
On October 30, 2023, the Company's Board of Directors (the "Board") approved a share repurchase program (the "Repurchase Program") authorizing the Company to repurchase up to
Fiscal Year 2025 Full Year Outlook
The Company is reaffirming its full year 2025 guidance, which includes the expected impact of the current applicable tariff rates and the Company's anticipated mitigation actions. However, it does not include the potential impact of the currently delayed reciprocal tariffs. Accordingly, we reiterate the following expectations for fiscal 2025:
- Net sales expected to be between
$555 million and$570 million , with projected Vita Coco Coconut Water growth of mid to high teens and the planned benefit of Vita Coco Treats rollout, and branded price increases, partially offset by increased promotional activity and softness in private label. - Gross margin expected to be between
35% and37% , with expected higher average transportation costs and increased finished goods costs, partially offset by planned Vita Coco Coconut Water net pricing increases and increased percentage volume mix of branded versus private label. - SG&A expenses expected to increase low to mid-single digits versus 2024.
- Adjusted EBITDA1 expected to be in the range of
$86 million to$92 million .
Uncertainty and instability of the current operating environment, geopolitical landscape, and global economies, including changes in tariff rates, associated potential competitive pricing actions and our own price elasticity, could affect this outlook and our future results.
Footnotes:
(1) Adjusted EBITDA represents earnings before interest, taxes, depreciation, and amortization as adjusted for certain items as set forth in the reconciliation table of U.S. GAAP to non-GAAP information and is a measure calculated and presented on the basis of methodologies other than in accordance with GAAP. Please refer to the Non-GAAP Financial Measures herein for further discussion and reconciliation of this measure to GAAP measures.
(2) GAAP Net Income 2025 outlook is not provided due to the inherent difficulty in quantifying certain amounts due to a variety of factors including the unpredictability in the movement in foreign currency rates, as well as future charges or reversals outside of the normal course of business.
Conference Call and Webcast Details
To participate in the live earnings call and question and answer session, please register at https://register-conf.media-server.com/register/BI925f9ea2f95f4cdf96a415106a309e1b and dial-in information will be provided directly to you. The live audio webcast will be accessible in the “Events” section of the Company’s Investor Relations website at https://investors.thevitacococompany.com. An archived replay of the webcast will be available shortly after the live event has concluded.
About The Vita Coco Company
The Vita Coco Company is a family of brands on a mission to reimagine what’s possible when brands deliver healthy, nutritious, and great tasting products that are better for consumers and better for the world. This includes its flagship coconut water brand Vita Coco, sustainably packaged water Ever & Ever, and protein-infused water PWR LIFT. The Company was co-founded in 2004 by Michael Kirban and Ira Liran and is a public benefit corporation and Certified B Corporation. Vita Coco, the principal brand within the Company’s portfolio, is the leading coconut water brand in the U.S. With electrolytes, nutrients, and vitamins, coconut water has become a top beverage choice among consumers after a workout, in smoothies, as a cocktail mixer, after a night out, and more.
Contacts
Investor Relations:
ICR, Inc.
investors@thevitacococompany.com
Non-GAAP Financial Measures
In addition to disclosing results determined in accordance with U.S. GAAP, the Company also discloses certain non-GAAP results of operations, including, but not limited to, Adjusted EBITDA, that include certain adjustments or exclude certain charges and gains that are described in the reconciliation table of U.S. GAAP to non-GAAP information provided at the end of this release. These non-GAAP measures are a key metric used by management and our board of directors to assess our financial performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance and because we believe it is useful for investors to see the measures that management uses to evaluate the Company. In addition, we believe the presentation of these measures is useful to investors for period-to-period comparisons of results as the items described below in the reconciliation tables do not reflect ongoing operating performance.
These measures are not in accordance with, or an alternative to, U.S. GAAP, and may be different from non-GAAP measures used by other companies. In addition, other companies, including companies in our industry, may calculate such measures differently, which reduces its usefulness as a comparative measure. Investors should not rely on any single financial measure when evaluating our business. This information should be considered as supplemental in nature and is not meant as a substitute for our operating results in accordance with U.S. GAAP. We recommend investors review the U.S. GAAP financial measures included in this earnings release. When viewed in conjunction with our U.S. GAAP results and the accompanying reconciliations, we believe these non-GAAP measures provide greater transparency and a more complete understanding of factors affecting our business than U.S. GAAP measures alone.
Forward-Looking Statements
This press release contains 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. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including but not limited to, statements regarding our future financial and operating performance, including our GAAP and non-GAAP guidance, our strategy, projected costs, prospects, expectations, plans, objectives of management, supply chain predictions, customer and supplier relationships, and expected net sales and category share growth.
The forward-looking statements in this release are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements involve a number of risks, uncertainties or other factors beyond the Company’s control. These factors include, but are not limited to, those discussed under the caption “Risk Factors” in our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and our other filings with the U.S. Securities and Exchange Commission ("SEC") as such factors may be updated from time to time and which are accessible on the SEC’s website at www.sec.gov and the Investor Relations page of our website at https://investors.thevitacococompany.com. Any forward-looking statements contained in this press release speak only as of the date hereof and accordingly undue reliance should not be placed on such statements. We disclaim any obligation or undertaking to update or revise any forward-looking statements contained in this press release, whether as a result of new information, future events or otherwise, other than to the extent required by applicable law.
Website Disclosure
We intend to use our websites, vitacoco.com and investors.thevitacococompany.com, as a means for disclosing material non-public information and for complying with the SEC's Regulation FD and other disclosure obligations.
THE VITA COCO COMPANY, INC. CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share data) | |||||||
March 31, 2025 | December 31, 2024 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 153,608 | $ | 164,669 | |||
Accounts receivable, net of allowance of | 76,759 | 63,450 | |||||
Inventory | 88,335 | 83,600 | |||||
Supplier advances, current | 1,124 | 954 | |||||
Derivative assets | 459 | 1,382 | |||||
Prepaid expenses and other current assets | 31,197 | 27,236 | |||||
Total current assets | 351,482 | 341,291 | |||||
Property and equipment, net | 2,710 | 2,351 | |||||
Goodwill | 7,791 | 7,791 | |||||
Supplier advances, long-term | 2,217 | 2,254 | |||||
Deferred tax assets, net | 6,099 | 6,100 | |||||
Right-of-use assets, net | 11,028 | 385 | |||||
Other assets | 2,642 | 2,209 | |||||
Total assets | $ | 383,969 | $ | 362,381 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 22,627 | $ | 30,758 | |||
Accrued expenses | 67,573 | 65,603 | |||||
Notes payable, current | 10 | 10 | |||||
Derivative liabilities | 3,155 | 6,895 | |||||
Total current liabilities | 93,365 | 103,266 | |||||
Notes payable, long-term | — | 3 | |||||
Operating lease liability, long-term | 12,583 | — | |||||
Other long-term liabilities | 163 | 295 | |||||
Total liabilities | $ | 106,111 | $ | 103,564 | |||
Stockholders’ equity: | |||||||
Common stock, March 31, 2025 and December 31, 2024, respectively; 57,018,300 and 56,961,941 Shares Outstanding at March 31, 2025 and December 31, 2024, respectively. | 638 | 637 | |||||
Additional paid-in capital | 175,241 | 174,077 | |||||
Retained earnings | 175,576 | 156,694 | |||||
Accumulated other comprehensive loss | (365 | ) | (860 | ) | |||
Treasury stock, 6,789,419 shares at cost as of March 31, 2025, and 6,740,446 shares at cost as of December 31, 2024. | (73,232 | ) | (71,731 | ) | |||
Total stockholders’ equity | 277,858 | 258,817 | |||||
Total liabilities and stockholders’ equity | $ | 383,969 | $ | 362,381 |
THE VITA COCO COMPANY, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except for share and per share data) | ||||||
Three Months Ended March 31, | ||||||
2025 | 2024 | |||||
Net sales | $ | 130,921 | $ | 111,698 | ||
Cost of goods sold | 82,836 | 64,521 | ||||
Gross profit | 48,085 | 47,177 | ||||
Operating expenses | ||||||
Selling, general and administrative | 28,792 | 28,218 | ||||
Income from operations | 19,293 | 18,959 | ||||
Other income (expense) | ||||||
Unrealized gain/(loss) on derivative instruments | 2,817 | (2,525 | ) | |||
Foreign currency gain | 580 | 58 | ||||
Interest income | 1,518 | 1,523 | ||||
Other income | 155 | — | ||||
Total other income (expense) | 5,070 | (944 | ) | |||
Income before income taxes | 24,363 | 18,015 | ||||
Income tax expense | 5,481 | 3,777 | ||||
Net income | $ | 18,882 | $ | 14,238 | ||
Net income attributable to The Vita Coco Company, Inc. per common share | ||||||
Basic | $ | 0.33 | $ | 0.25 | ||
Diluted | $ | 0.31 | $ | 0.24 | ||
Weighted-average number of common shares outstanding | ||||||
Basic | 56,994,146 | 56,589,565 | ||||
Diluted | 59,975,827 | 58,746,631 | ||||
THE VITA COCO COMPANY, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) | |||||||
Three Months Ended March 31, | |||||||
2025 | 2024 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 18,882 | $ | 14,238 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 202 | 162 | |||||
(Gain)/loss on disposal of equipment | — | 13 | |||||
Bad debt expense | 434 | 517 | |||||
Unrealized (gain)/loss on derivative instruments | (2,817 | ) | 2,525 | ||||
Stock-based compensation | 2,186 | 2,109 | |||||
Noncash lease expense | 504 | 254 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (13,150 | ) | (8,463 | ) | |||
Inventory | (4,508 | ) | (6,068 | ) | |||
Prepaid expenses, net supplier advances, and other assets | (2,583 | ) | (1,442 | ) | |||
Accounts payable, accrued expenses, and other long-term liabilities | (8,950 | ) | (4,112 | ) | |||
Net cash used in operating activities | (9,800 | ) | (267 | ) | |||
Cash flows from investing activities: | |||||||
Cash paid for property and equipment | (559 | ) | (124 | ) | |||
Net cash used in investing activities | (559 | ) | (124 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from exercise of stock options/warrants | 404 | 153 | |||||
Cash received (paid) on notes payable | (2 | ) | (4 | ) | |||
Cash paid to acquire treasury stock | (1,501 | ) | (9,235 | ) | |||
Net cash used in financing activities | (1,099 | ) | (9,086 | ) | |||
Effects of exchange rate changes on cash and cash equivalents | 401 | (80 | ) | ||||
Net decrease in cash and cash equivalents | (11,057 | ) | (9,557 | ) | |||
Cash and cash equivalents at beginning of the period | 165,933 | 132,867 | |||||
Cash and cash equivalents at end of the period | $ | 154,876 | 123,310 |
1 Includes
RECONCILIATION FROM GAAP NET INCOME TO NON-GAAP ADJUSTED EBITDA | |||||||
Three Months Ended March 31, | |||||||
2025 | 2024 | ||||||
(in thousands) | |||||||
Net income | 18,882 | 14,238 | |||||
Depreciation and amortization | 202 | 162 | |||||
Interest income | (1,518 | ) | (1,523 | ) | |||
Income tax expense | 5,481 | 3,777 | |||||
EBITDA | $ | 23,047 | $ | 16,654 | |||
Stock-based compensation (a) | 2,186 | 2,109 | |||||
Unrealized (gain)/loss on derivative instruments (b) | (2,817 | ) | 2,525 | ||||
Foreign currency (gain)/loss (b) | (580 | ) | (58 | ) | |||
Other adjustments (c) | 669 | — | |||||
Adjusted EBITDA | $ | 22,505 | $ | 21,230 |
(a) | Non-cash charges related to stock-based compensation, which vary from period to period depending on volume and vesting timing of awards and forfeitures. We adjusted for these charges to facilitate comparison from period to period. | ||
(b) | Unrealized gains or losses on derivative instruments and foreign currency gains or losses are not considered in our evaluation of our ongoing performance. | ||
(c) | Other adjustments include |
SUPPLEMENTAL INFORMATION | |||||
NET SALES | |||||
Three Months Ended March 31, | |||||
(in thousands) | 2025 | 2024 | |||
Americas segment | |||||
Vita Coco Coconut Water | $ | 86,118 | $ | 69,522 | |
Private Label | 21,197 | 24,273 | |||
Other | 5,285 | 2,296 | |||
Subtotal | $ | 112,600 | $ | 96,091 | |
International segment | |||||
Vita Coco Coconut Water | $ | 13,177 | $ | 9,665 | |
Private Label | 4,759 | 5,152 | |||
Other | 385 | 790 | |||
Subtotal | $ | 18,321 | $ | 15,607 | |
Total net sales | $ | 130,921 | $ | 111,698 |
COST OF GOODS SOLD & GROSS PROFIT | |||||||
Three Months Ended March 31, | |||||||
(in thousands) | 2025 | 2024 | |||||
Cost of goods sold | |||||||
Americas segment | $ | 70,288 | $ | 55,219 | |||
International segment | 12,548 | 9,302 | |||||
Total cost of goods sold | $ | 82,836 | $ | 64,521 | |||
Gross profit | |||||||
Americas segment | $ | 42,312 | $ | 40,872 | |||
International segment | 5,773 | 6,305 | |||||
Total gross profit | $ | 48,085 | $ | 47,177 | |||
Gross margin | |||||||
Americas segment | 37.6 | % | 42.5 | % | |||
International segment | 31.5 | % | 40.4 | % | |||
Consolidated | 36.7 | % | 42.2 | % |
VOLUME (CE) | ||||||||
Percentage Change - Three Months Ended March 31, 2025 vs. 2024 | ||||||||
Americas segment | International segment | Total | ||||||
Vita Coco Coconut Water | 23.5 | % | 34.7 | % | 25.2 | % | ||
Private Label | (2.3) | % | 13.5 | % | 0.7 | % | ||
Other | 187.8 | % | (2.7) | % | 172.4 | % | ||
Subtotal | 19.2 | % | 27.2 | % | 20.5 | % |
Note: A CE is a standard volume measure used by management which is defined as a case of 12 bottles of 330ml liquid beverages or the same liter volume of oil.
*International Other excludes minor volume that is treated as zero CE
