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Boston Beer founder, ceo and chairman Jim Koch talked at length about improved trend for the total beer/malt bev business in early 2026. He talked about a 300 basis point improvement in trend in last coupla mos. That's even evident in Boston's total depletions, at least compared to Q4. Boston STRs down 3% so far this yr, after 6% drop in Q4 (-4% for full calendar yr), but that includes RTDs. SAM's overall volume outlook remains soft, flat to down mid-singles. "Guidance both surprises and disappoints," wrote Bernstein's Nadine Sarwat. Apparently investors agree. Stock down 7% earlier this morn, tho improved to -5% at presstime. Moderation on Health, Hispanics Coming Back; "Bloom Off Rose" on Hemp; Closed Loophole Likely to "Stand" While total biz improvement is "welcome, I wish I could tell you what was going on," Jim said. Then he took several (educated) guesses: "I think there's been some moderation in the clamor around health&hellip;. We had the government guidelines come out and be pretty much consistent with previously&hellip;. Maybe the Hispanic community has adjusted to some of the new realities and found ways to come back and be visible." And after closing of the hemp "loophole" passed by Congress and slated for Nov '26, "I think the bloom is a little bit off the rose with hemp&hellip;. So that might have contributed to it." Jim predicted that the "repeal of the hemp loophole will probably stand in Congress. And so the impact of the hemp-based beverages will diminish." He acknowledged that in some states (he listed LA, MN, SC and TN), hemp bevs are 5-10% of certain retailers' biz and had bigger effect on alc bevs.Sun Cruiser "Scaled Quickly"; Big Growth in 2026; Sinless "Quasi-National" Expansion Boston got big boost from Sun Cruiser in 2025 as it grew 300%, became a top 5 spirits RTD brand "from kind of nowhere 1.5 years ago" and a lot of that success happened without getting chain authorizations. "We believe there is certainly 1 more year, maybe 2 more years&hellip; of really strong growth in Sun Cruiser. We got a late start in the category" and missed 2025 window with many chains, tho Walmart leaned in. But now it's getting much broader distribution in chains, increasing investment in brand that gets as much as 40% of its sales on-premise in some mkts.In terms of innovation pipeline, "the big news is one of our flavor innovations in 2025 has proved very successful," said Jim. That's Sinless, the Carbliss RTD competitor, with zero carbs, zero sugar and less than 100 calories. Boston is "rolling it out" to over 30 states in a "quasi national" launch. "We're optimistic enough to roll it out in the majority of the country."What About Base Biz? Shoring Up Twisted, Truly; Angry Orchard and Dogfish Head Up 3 Qtrs in a Row Angry Orchard and Dogfish Head just came off "a third consecutive quarter of growth," noted Jim. But Twisted is much, much bigger, almost half of Boston's biz and it had a rough 2025. $$ down 6% in scans, Jim noted. It "overindexes with lower income households and Hispanic drinkers." Brand gained distribution in 2025 but "declined in velocities." Yet Twisted Tea Light and Extreme grew velocities and "have room to gain additional shelf-space." Boston still has 85% of malt-based hard tea. About 20% of Twisted's 2025 decline is because of growth in vodka tea, including Sun Cruiser, according to Numerator data. In 2026, Boston will up spend on Twisted across numerous partnerships, introduce more affordable packs and new singles flavors, plus it worked with distribs where "our pricing might have been too aggressive&hellip; primarily 12 packs in supermarkets."Meanwhile, Truly still declining even as seltzer started to level off. "We have been, kind of, honestly a weak #2" in seltzer, said Jim. Seltzers are "viable" and category "can be stable." White Claw has "done a great job" and is "growing&hellip;. We would like to get Truly to the point where it is no longer absorbing the category losses and maybe it's growing low single digits a year." Boston investing more in Truly this yr too, and considers its US soccer team partnership to be "a very big deal." As for Sam Adams, the one that "brought them to the dance," not much said about it on the conference call. But Sam Adams and Dogfish Head "combined to hold share in a challenging craft beer category," said Jim. Sam Adams will "launch limited edition packaging to help celebrate America's 250th anniversary. And Sam Adams/Dogfish craft beer biz still collectively makes up 15% of its volume mix, over 1 mil bbls.

Boston Beer's Jim Koch on Better Category, Sun Cruiser, Sinless Hopes; But Stock -5%

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