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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:

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First batch of 4th-qtr numbers suggest tuff but not terrible start to final period of 06.  Oct taxpaid shipments soft: -300,000 bbls, 2.1% despite fairly easy comp (flat in 05) and 1 more selling day.  Yet, despite virtually no growth since Mar, taxpaids still up 1.625 mil bbls, 1.1% YTD.  Nov-Dec last yr was flat.  No import shipments data available yet for 4th qtr, but comps kinda tuff in Oct (+21% last yr) and Nov (+13%), tho Dec down in 05.  STR trends for top 2 nuthin’ to shout about.  AB said on Nov 28 that Oct-Nov STRs even so far, down 0.8% excluding incremental volume from Rock, Grolsch, etc.  Miller spokesman sez Miller Lite numbers have “turned positive” since Oct 1.  (Recall Miller set goal of 5-pt improvement in Lite trend for 6 mos thru Mar 07 vs 6 mos thru Sep 06.)  Miller’s overall STR trend so far for Q4 slightly better than -5% reported for 3d qtr (excluding incremental McKenzie volume).  Coors STRs still runnin’ up, we hear, even as comps got tuffer.  Retail trends mixed.  C-store volume up healthy 4.6% for 4 wks thru Nov 4, reports ACNielsen, with imports and crafts flyin’ (up 27-29%). Even…

Publishing Info

  • Year 2006
  • Volume 37
  • Issue # 22
Molson and Coors been tryin’ to consolidate Molson brands with Coors distribs since they formed Molson USA back in 2001. Back in 01, Molson USA had 502 distribs in US, but only 176 were also Coors distribs then. By Jul 18, 06 Molson USA still had 452 distribs in US, but 85% or 384 were “Coors-aligned.” But only one deal done in key NY mkt, 30% of Molson’s biz in US. (Molson sold approx 740,000 bbls in US in 05.) Until now. Molson USA just won arbitration award allowing it to terminate upstate distrib Ryan under NY franchise law provision 55-c that considers natl consolidation policy a form of “good cause.” Parties have month or so to determine fair mkt value of lost distrib rights, or there will be 2d round of arbitration to determine price. In wake of decision 4 other NY Molson distribs on tap to lose brands and Molson will be left with 5 distribs in state. Recall Ryan tried to stop this process in 05, arguing NY franchise law prohibits arbitration requirement. But US Dist Ct ruled that 21st Amendment trumped by Fed Arbitration Act. Arbitrator found Molson USA made “good faith effort to fashion its…

Publishing Info

  • Year 2006
  • Volume 37
  • Issue # 21
For 3d qtr in a row, AB beat Wall St expectations on profits.  There were 3 main reasons: rev per bbl up 2.8%, more than anticipated, cost of goods sold increases moderated (in part because of AB’s productivity initiatives) and AB again shipped more than it depleted (because Sep sales came in much less than expected).  With 1% shipments hike and rev per bbl up 3%, AB domestic beer income before taxes up $51 mil, 7%.  That’s almost like “good old days” of early 2000s.  But for 9 mos, domestic beer income before taxes still up just 3% to $2.366 bil.  Recall that domestic beer unit income down 18% in 05.  Meanwhile, AB equity income (mostly from Modelo) jumped $59 mil, 15% to $450 mil thru Sep 06.  Over 1/4 of AB’s total net income comes from Modelo and about 1/3 of net inc growth.    AB’s Sep STRs “below expectations,” acknowledged cfo Randy Baker, citing “unfavorable” weather in much of East especially over Labor Day and tuff comps going against heavy couponing in Sep 05.  But “we cannot explain all of the shortfall,” noted Randy.  What’s more, Oct sales still “down slightly” tho better than Sep and “bouncing around.”  AB…

Publishing Info

  • Year 2006
  • Volume 37
  • Issue # 20
Imports shipments still in the sweet spot: up another 241,000 bbls, 10.1% in Aug.  Shipments from Mexico, Canada, Netherlands and Belgium all up double-digits.  But whacked in Aug: shipments from Germany and Ireland (down 20% or more).  UK shipments down too.  For 8 mos, imports up 1.9 mil bbls, 11%.  That’s about same volume gain as domestic taxpaid shipments.  So total US shipments picture still pretty rosy: +3.9 mil bbls, 2.8% for 8 mos.  Virtually unanimous that Sep retail was horrible, at least for AB and Miller, and not so hot for others.  But unclear if that will be reflected in Sep shipments number.  With top brewers’ shipments runnin’ ahead of STRs, question remains how much will be given back in last qtr, assuming retail trend doesn’t bounce back.  Jan-Aug imports especially strong from Mexico (+1 mil bbls, 13%) and Netherlands (+685,000 bbls, 17%).  Then too, Canadian shipments up solid 167,000 bbls, 8% YTD, following 4 straight yrs when shipments from north of border declined.  Howzatt?  Canadian brands ain’t doin’ much better, but turns out Coors has been shipping Blue Moon into several states from Canada.  And some of Canadian gain probably Guinness brands.  UK and Irish shipments flattish and…

Publishing Info

  • Year 2006
  • Volume 37
  • Issue # 19
Interesting situation in Oh highlights tuff challenges AB faces in moving new brands to its distrib system.  When AB bought Rolling Rock, 11 Oh distribs had brand, none AB.   (RR sold about 740,000 cases there in 05, but volume slipping.)  Turns out 10 of 11 got together and appointed single negotiator (broker/consultant Andy Christon) to work with AB and its distribs to move majority of volume more easily.  Discussions held, and different prices bandied about, we hear.  But in the end AB distribs couldn’t agree on a value acceptable to sellers.  Gotta keep in mind Andy’s theory of “golden cases”: small volume brands have high value to distribs since they bear very little cost to distribute.  But most AB distribs not used to buying (or valuing) single brands.  And here’s kicker: under Oh franchise law, AB had 90-day window to terminate all of the Oh distribs, move brand and pay “diminished value” of sellers’ biz.  Value includes “appraised market value” and “goodwill.”  But that process was likely to involve strong disagreements (it already had) and could have resulted in multiple, potentially expensive lawsuits which AB certainly wanted to avoid.  With so many brands changing hands these days, AB distribs wanted…

Publishing Info

  • Year 2006
  • Volume 37
  • Issue # 18
Consolidation of AB’s distrib network less advanced than Miller/Coors, but that’s beginning to change.  AB down to under 600 equity agreements and under 700 locations. At least a half dozen smaller AB deals closed since May.  Most exiting distribs are smaller, typically about 1-1.5 mil cases. Largest done deal: Silver Eagle in Homestead, Fla (2.5-3 mil cases), sold to Golden Eagle of Miami (the de la Cruz family).  Then too, Capital Bev Sales in St Paul (owned by ex-AB veep Paul Morrissey) bought 2 smaller distribs totaling 1.8 mil cases.  It will now be slightly under 4 mil cases.  Several other sales of 1-1.5 mil case distribs to contiguous mkts.  Included Marcy Dist in Okla, partly to branch and partly to Premium Beers of OK, P&E in Hopkinsville, Ky to Budweiser of Clarksville in contiguous Tenn mkt and House of Brews in Springfield,Ill to neighboring Skeff Dist.  AB distribs also actively trying to consolidate acquired brands.  While over 80% of Grolsch biz transitioned, only 50% or so of Rock volume even close to deals.  Rock transition a huge headache for AB so far.  Many Rolling Rock wholesalers are not willing sellers and some AB distribs are not willing buyers.  For…

Publishing Info

  • Year 2006
  • Volume 37
  • Issue # 17