Reed’s, a California-based maker of sodas in natural food stores, has reported 27% growth in revenues to $7.8m for the second quarter (Q2) ended 30 June 2012, compared to the same period a year ago.

Net income was $444,000, or $0.04 per share, compared to a loss of $55,000 a year earlier.

Gross profit increased to $2.7m, an increase of 39% from 2011, while the gross profit percentage increased to 34% of sales, an increase from 31% in 2011.

Earnings before non-cash items and finance costs were increased to $831,000 during 2012, as compared to $395,000 in the prior year.

During the reporting quarter, the company developed and launched its new Reed’s Culture Club Kombucha in four flavours and also introduced Reed’s Chocolate Crystallized Ginger candy.

Reed’s also expanded its distribution partners in South Carolina, Michigan, Utah and Tennessee and started shipping a new Private Label project for large national supermarket chain.

Reed’s CEO and founder Chris Reed said this is the company’s 11th quarter of double-digit revenue growth and has resulted in the company moving into a profitable position.

"We believe our momentum will continue in the second half of the year. Our new Kombucha line continues to roll out nationally," Reed added.

Reed’s chief financial officer James Linesch said the company has reached a profitable sales velocity and margin contribution by holding down costs and by investing in effective promotions.

"Our gross margins have increased mostly through higher effective prices and lower production and raw material costs overall, while also making a higher investment in promotions and discounts this year," Linesch added.