Reed's, Inc. has posted a marked lift in operating loss for the third quarter.

The US soft drinks producer said yesterday (14 November) that operating loss for the three months to the end of September soared to US$1.5m from an operating loss of $288,766 in the corresponding period a year earlier.

The loss came despite growing sales, which were up by 40% year-on-year to $3.9m from $2.8m. Net loss also increased, to $1.5m from $401,000.

Sales growth was driven by an 82.3% increase in the company's Virgil's product line and a 14.9% increase in the Reed's Ginger Brews product line.

Operating expenses leapt by 150%, due primarily to "building out the infrastructure to support the anticipated growth in sales and production capacities", the company said.

For the first nine months of this year, operating loss rose to $2.6m from $1m, as sales lifted by 31% to $10.4m from $7.9m. Net loss doubled to $2.7m from $1.3m.

Looking forward, Reed's revised its sales growth guidance for this year, from the initial 20% to 40% to between 25% to 35%.

"Our strong third quarter results reflect our continued ability to increase brand awareness by investing in our sales and marketing efforts, expanding our product offering and adding additional points of distribution," said Chris Reed, Reed's founder and CEO.

"We are optimistic about our future prospects and are on track to enter ten additional markets in the second half of 2007."