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Beer Marketer's INSIGHTS

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Beer Marketer's INSIGHTS, our flagship newsletter, is published 23X a year. For the last 38 years, it has frequently been the first and often only publication to report the most important beer industry facts, trends, and insights. Each issue features four info-packed pages. Inside, you'll find the latest news and numbers about the US beer business, with a special focus on exclusive articles and analysis. Readers of Beer Marketer's INSIGHTS get the info necessary to stay abreast of the latest industry events, and the understanding of those events. Here's just a small sampling of what you'll find inside:

Beer Marketer's INSIGHTS is written by the most experienced and knowledgeable staff serving the industry. More execs keep up-to-date by reading Beer Marketer's INSIGHTS than any other beer industry publication.

Join thousands of beer industry executives, ad agency representatives, government regulators, bankers, analysts, attorneys, and others who need to know as much as possible about the beer industry. These execs benefit from INSIGHTS' authoritative reporting and analysis. Put that advantage to work for you. A one year-subscription is priced at $750 dollars (add $25 outside of US). As with all our newsletters, we offer a money-back guarantee: if Beer Marketer's INSIGHTS fails to meet your expectations, we will gladly refund the unused portion of your subscription.

Ain’t just AB warning of “significant cost pressures” in 2008. Company comments, articles and research on costs ran rampant in recent weeks, especially concerning agricultural commodities. Barley and hops prices are thru the roof these days, with articles citing 50-100% increases in malt and barley prices (relatively small % of total big brewer costs, but gotta note). “Beverage Margins squeezed by input costs” was title of lengthy UK research piece by Dresdner Kleinwort in late Oct. Energy and metals “reached all-time high” in last 18 mos, and “raw material prices are close to an all-time high,” wrote Simon Hales of DrKw. “Brewers are most exposed to higher raw material costs.” Another competitive advantage for spirits, which also feel heat, but it’s less pronounced for them. Spirits cos also better able to price up, wrote DrKw. For both brewers and distillers, earnings “likely to come under increasing pressure in 2008 and 2009.” While “price increases should mitigate some of the downside,” beer biz “has a poor track record on pricing, notably in developed markets.” Editor’s note: earlier in 21st century, US beer prices increased above inflation for several yrs before returning to below inflation last 2 yrs, and about in-line this…

Publishing Info

  • Year 2007
  • Volume 38
  • Issue # 20
SABMiller and Molson Coors announcement to form US JV (expected to close summer 08 if approved by Feds) hit US beer biz like a thunderbolt.  Shapes up as single most doable move to create massive value in US beer biz in one fell swoop.  Tho long forecast and talked up since early 90s, timing still took many by surprise.  Players kept pretty tight lid as they got close on one of most important developments of this or any decade.    Discussions reportedly had foundered on basic issues like ownership structure and mgt in past.  In end, SABMiller seemingly accepted 50-50 JV (tho it has 58% of value) and Molson Coors ceo Leo Kiely atop new venture.  But Leo only “committed to do this for 2 years,” he said in conference call, with 6-mo evergreen clause beyond that.  “Our clear intention is to groom succession from within,” he added.  SABMiller “gets the nod on nomination for successor and Tom Long sits in a very critical position in this new organization.”  While ceo Leo has day-to-day mgmt responsibility, prexy/chief commercial officer Tom will have specific responsibility for “marketing, sales, and distribution and strategy functions,” according to letter of intent.  So a lot of…

Publishing Info

  • Year 2007
  • Volume 38
  • Issue # 19
Lotsa interesting info in presentations by SABMiller execs to investors Sep 25.  In addition to widely reported improved US trends – total STRs up 1.3% (including Chill, excluding McKenzie brands), Lite STRs up 1.7% Apr thru Aug.  SABMiller ceo Graham Mackay showed how Miller calculates US profit pool for suppliers (that’s EBIT, earnings before interest and taxes, for 2006).  Total US beer profits, in SABMiller view: $4.277 bil.  Two-thirds come from “mainstream” segment, $2.9 bil.  Hi-end accounts for another 27.5%, with imports at 19% ($813 mil), craft/ super premium at 8.5% ($364 mil).  That leaves just $222 mil, or 5.2% for economy brands, tho still 18 share of volume.  Miller’s problem: it has higher share of economy than any other segment, about 1/3 judging from pie chart in Graham’s presentation.  Miller grabs about 20% of mainstream profits, a little above its overall mkt share.  But just tiny slivers, for now, of hi-end, or what Miller calls “worthmore.”  These figures show why Miller puttin’ so much emphasis on high end these days, and much less on low end.  SABMiller’s measure of US profit pool a bit lower than others we’ve seen.  Implies AB grabs near 2/3 of profit pool (it booked…

Publishing Info

  • Year 2007
  • Volume 38
  • Issue # 18
AB’s c-store challenge (see INSIGHTS vol 38, no 9) exacerbated during peak selling season as Bud family softened further and even Bud Light lost share over summer. Only 4 of top 25 brands in c-stores lost more than 0.1 share of $$ for 12 weeks thru 9/8, according to ACNielsen. Three were in Bud family. Tho Bud Light held its enormous 25.8 share of c-store $$ yr-to-date, it lost 0.3 share of $$ as volume flattened out last 12 weeks. Meanwhile, brand Bud lost 0.8 share and Bud Select 0.3 share (with declines nearing 25%) for 12 weeks. Tote ‘em up and industry’s leading brand family with almost 40 share of c-store $$ sales dropped 1.4 share. In all, AB down 1.2 share to 58 for 12 weeks. Other than Bud family, AB actually gained 0.2 share, led by solid gains for Natural Ice, Michelob Ultra ($$ up 13% for 4 weeks) and Bud Ice. Miller, Coors and imports each gained 0.4 share last 12 weeks. Tho Miller gained 0.4 of $$, Lite down 0.1 share, Gen Draft lost 0.2 share, Mil Best/Mil Best Ice each down 0.1. High Life gained 0.1 (and up double-digits). Still, Miller’s growth driven by…

Publishing Info

  • Year 2007
  • Volume 38
  • Issue # 17
AB had some good news at Lehman Brothers back-to-school conference Sep 6 in Boston and stock ticked up 2%+ that day.  Main new nugget: AB sales-to-retailers up 2.4% in 3d qtr to date, AB ceo August Busch IV said.  That included 0.8% gain on core brands.  While a significant improvement from 1.5% drop in 1st half, still down yr-to date.  AB 2d half rev per bbl also expected to “significantly exceed” 2.7% growth in 1st half, said August.  Earnings will accelerate in 2d half “especially” in 4th qtr, going against inventory reduction last yr, said cfo Randy Baker.  AB reiterated expectation that it will exceed longterm growth target of 7-10% EPS in 2007.  AB has made “great progress,” according to August in coming thru “significant period of transition.”  AB confident in its new model and “dust is now settling,” he added.  AB has “modified what we sell and changed how we sell it.”  It now has over 7 share of imports and added over 2 mil bbls in segment thru its recent acquisitions and alliances.  August noted “encouraging” Jul-Aug on InBev brands, which are “starting to get some traction.”  Meanwhile, Bud Light up over 1% thru Jul, August said and…

Publishing Info

  • Year 2007
  • Volume 38
  • Issue # 16
Boston shipments up another 15% in 2d qtr, +18.5% for 6 mos.  STRs runnin’ +17%.  And Boston now expects 15% shipments gain for 9 mos.  That’s on top of 17% gain in 06.  Revs and profits solid too.  Boston rev per bbl up 2.4% yr-to-date.  Tho cost of goods/bbl increased sharply (+8%) and gross margin squeezed, Boston managed to reduce ad/selling/ promo and admin expenses/bbl.  Sooperating income up almost $2/bbl, 10% to $21.11.  Oper income at $19.1 mil for 6 mos, up $4.4 mil, even with $3.4 mil write-off of costs for Mass brewery project.  Importantly, looks like Boston will avoid building pricey ($170-$200 mil) new brewery in New Eng.  Instead, it plans to purchase eastern PA plant from Diageo for $55 mil, then spend additional $30-75 mil in upgrades for expected late-08 start-up if due diligence goes smoothly.  Net-net, Boston will spend about half or less for double the capacity (1.6 mil bbls+) of original project.  Meanwhile, Boston already having product made at ex-Rolling Rock brewery in Latrobe, PA, will spend $3-7 mil on upgrades there and may yet acquire ownership stake in that plant. One glitch: “some issues” at Boston’s Cinnci brewery after runnin’ it 24/7 this summer. …

Publishing Info

  • Year 2007
  • Volume 38
  • Issue # 14