California-based Monster Beverage has recorded an increase in net sales in the first quarter (Q1) of 2018 despite the adoption of the US Accounting Standards Codification (ASC) 606 in December 2017.

Net sales increased by 14.7% from $742.1m in Q1 2017 to $850.9m in Q1 2018. Monster Beverage claimed that the sales were negatively impacted by $9.9m as a result of the ASC 606 implementation.

The net sales for the company’s energy drink segment, which include Monster Energy, Monster Hydro and Mutant Super Soda, rose 16.7% in the quarter from $668.6m in the first quarter of 2017 to $780.5m. Sales were negatively affected by $3.9m from adoption of ASC 606.

Monster Beverage’s strategic brands segment, which is comprised of energy drinks acquired from Coca-Cola, experienced a 3.3% decline in sales from $68m to $65.8m. The segment was negatively affected by $6m due to ASC 606.

Sales for its other segment were $4.7m down from $5.5m in Q1 2017.

Foreign currency exchange rates had a positive effect on net and gross sales for Q1 2018 of $17.7m and $22.2m respectively.

The company recorded growth in net income of 21.4% to $216.1m and net income per share of 23.1% to $0.38, but also a $15.6m reduction in operating income to $279.9m.

Gross profit’s proportion of net sales declines from 64.8% in Q1 2017 to 60.6% as result of an increase in promotional allowances as a percentage of gross sales, $9.9m of commissions accounted for a reduction in net sales due to adoption of ASC 606, as well as geographical and domestic product sales mix.