Tuff year for Heineken USA ended on up note (HUSA has already held forth on this several times before official #s). HUSA sales-to-retailers dropped 3.1% for yr, but “encouragingly, volume momentum in the US improved in the fourth quarter, led by Heineken and accelerated growth of the Dos Equis brand,” the co said. HUSA depletions had been down 4% in 1st half, so down only about 2% in 2d half, including 4th qtr significantly better than that. Its full yr 2011 trend very similar to AB and MillerCoors, but chief import competitor Crown grew depletions 4.5%. Heineken earnings in US also “declined, reflecting lower revenues, increased freight cost and increased marketing spend.” Total Americas, including FEMSA since May 1, accounted for 24% of the group’s global earnings.

Globally, Heineken handily beat consensus earnings estimates for the yr with 2.8% increase in earnings beia (before exceptional items and amortization) to around $3.5 bil on revs over $22 bil. Stock up 3-4% this morn. Heineken didn’t give earnings guidance for 2012 but it did say it expected 6% per hectolitre input cost hikes this yr. Having saved over $800 mil from Total Cost Mgt program in last 3 yrs, Heineken announced another program this morn to save an additional $650+ mil in next 3 yrs.

Diageo trends we headlined yesterday were for North American volume not DGUSA. While North American volume flat on beer, DGUSA beer volume up. Indeed, Diageo Guinness USA beer depletions up 3.1%, fiscal yr-to-date, Jul-Jan, the company said. But DGUSA depletion trend on PABs down 6.9% for same period, while North American ready-to-drink volume down 2% in 1st half. Depletions are often a more accurate indicator of what’s going on in mktplace.

Following 88,000-bbl, 4.7% increase in Dec, imports ended 2011 up 196,000 bbls, 0.7%. Mexican shipments slipped 4% in Dec, but up 609,000 bbls, 4.5% for the yr. Belgian shipments jumped 85% in Dec and up 294,000 bbls, 27% for the yr. Only other gains among top-dozen importing countries last yr: 133,000 bbls, 15.5% from Ireland and 7,000 bbls, 3.5% from Italy. Dutch shipments rallied with 17.5% gain in Dec, but dropped 430,000 bbls, 7.7% for 12 mos. Canadian shipments lost 261,000 bbls, nearly 10%. German shipments down 3%. UK shipments off 11%. Including import gain, total 2011 US shipments, before inevitable revisions, down 3.1 mil bbls, 1.5%.

Join us May 15-16 in Chicago at the Ritz Carlton for another deep dive into the exciting high end: craft beer, imports, FMBs/PABs, cider and more. We’ll have a full-day of jam-packed presentations on this profitable, growing and dynamic segment, plus plenty of networking time, with the key players who are building the high end of the malt bev biz. On tap so far is a top-notch, wide-ranging panel led by Bump Williams with Crown Imports prexy Bill Hackett, Boston Beer chairman Jim Koch, wholesaler Joe Salois of Atlas and HEB’s biz development mgr-beer Rusty Woodland. Also speaking will be New Belgium co-founder/ceo Kim Jordan and Diageo Guinness USA prexy Sheila Stanziale. And Crispin Cider prexy/founder Joe Heron, fresh off his deal with Tenth & Blake, will speak on emerging cider category. BMI publisher Benj Steinman will set up the day with data and insights. And there’s much more to come. Click here for more information. Click here to sign up.

Fed lawsuit is latest action in decades-long, unsuccessful effort to deal with tragic situation on SDak/Neb border. Oglala Sioux tribe living on dry SD Pine Ridge reservation (population 40,000) sued 4 retailers in tiny (population 12) Whiteclay town just across the border in Neb. For many years, tribal members have bought alcohol, mostly beer, in Whiteclay, smuggled it back and either resold or drank it on reservation. High rates of alcoholism and other alcohol-related problems on reservation have been topic of discussion, debate and fierce rhetoric on and off for many years, with no apparent progress/solution. Reservation went wet in 1970 but only for 2 mos. Now comes lawsuit vs 4 retailers, 4 Neb wholesalers and AB InBev, SABMiller, Molson Coors, MillerCoors and Pabst. Retailers sell approx 430,000-460,000 gals of beer annually, 4.4-5 mil 12-oz beers, according to suit. Gist of charges: defendants knew or should have known vast quantities of beer, “in amounts that cannot be legally sold, consumed or possessed,” are in fact sold in Whiteclay. Suit alleges too that defendants have “duty to make reasonable efforts to ensure” products sold according to Neb and tribal law, a duty they breached by “assisting and participating” in illegal sales. It also lists among alcohol damages: 1 in 4 babies on reservation born with fetal alcohol syndrome or fetal alcohol spectrum disorder; 85% of families “affected by alcoholism”; 90% of arrests alc-related. Suit does not specify damages sought, but AP reports tribe is demanding $500 mil.

Increasingly beer-centric retail chain, Buffalo Wild Wings, put up impressive 35% rev growth in 4th qtr, including 9% same-store growth in company-owned stores. It totaled revs of $700 mil in 2011 and oper income of $73 mil. And same store sales hotting up in 1st 6 weeks of 2012; up 12.9% at company-owned stores, 10.8% at franchised stores. Last yr, Buffalo Wild Wings began to put much wider selection of craft beers in many of its outlets (as detailed in our Craft Brew News) and focus more on draft quality. BWW is all about wings, beer and sports and frequently touts its “beer expertise.” CFO said on conference call: “We’re pleased with trend in beer sales” following increased focus on draft quality and wider selection of craft beers, but she didn’t give trend. It ain’t just Buffalo Wild Wings that’s hotting up. Chipotle same-store sales up 11% in 4th qtr. Even retail giant Costco saw same-store sales up 8% in Jan, an acceleration from 6% in 22 weeks ending Jan 29. Other chains like Brinkers or Ruby Tuesday’s, reported same store sales up just slightly (Brinker’s) or down (Ruby), noted Motley Fool. One important chain that continues to be under pressure is Wal-Mart. Same-store sales down 0.3% thru Sep, noted NY Post, citing trend as reason that WM “is finally opening its kimono” and sharing its sales data. Cut deal last week with NPD Group, following earlier deals with IRI and Nielsen. Yup, scan data later this yr will include Wal-Mart for 1st time in many, many moons.

An interesting twist in dealmaking as rapidly expanding Mich AB distrib Fabiano Brothers has deal to buy AB distrib in Indiana. Deal announced to employees earlier this week and expected to close in next two mos. With this deal, Fabiano jumps several hours South to acquire Nelsen Beverage, almost a mil case distrib in Warsaw, Indiana. This puts Fabiano right around 9 mil cases of AB brands (recall it had also bought 3-mil-case AB distrib in Flint, Mich a yr ago). And it has a significant wine biz too.

Deal interesting on several fronts. First, it’s uncommon in recent yrs for an AB distrib to go across state lines. Secondly, Indiana is extremely fragmented AB network, with 23 smaller AB distribs going against just 2 MillerCoors distribs. So it’s probably safe bet that Fabiano intends to acquire more AB distribs in Indiana, if possible. Third, Nelsen Bev equity mgr Hunter Carlile stays on as equity mgr of new entity, Fabiano Brothers Inc, Indiana. Finally, Fabiano Brothers also has big portfolio of other beer brands. So this deal shows AB’s answers on consolidation ain’t gonna be “one size fits all.”

Parrot Bay pouches are off to fast start, with rates of sale that are “greater than bottled PABs,” DGUSA prexy Sheila Stanziale told INSIGHTS. Pouches are getting big chain authorizations and sell best with palette sized front end displays which it is getting in major retailers. DGUSA likes what it sees in this space enuf that it is coming with 3 flavors of Smirnoff pouches too this summer. Guinness brands showed much improved trends in Diageo’s fiscal 1st half (thru Dec 31). Guinness brand family jumped 15% in IRI channels during period, said Sheila, led by Black Lager. What’s more, Guinness gained 4% on draft in Top 25 on-premise accounts, including Fado Irish pubs, Buffalo Wild Wings, Applebee’s etc. Two new Smirnoff Ice flavors announced today, Screwdriver and Tropical Fruit. But both already available in many mkts for several weeks. In some, Screwdriver already selling as much as several other Smirnoff flavors combined. DGUSA needs to do better job of managing “long dwindling tail” of lotsa Smirnoff brands, acknowledged Sheila. Jeremiah Weed is selling well in some areas, “ok” or not as well in others and so DGUSA will “heavy up” investment in regions where it’s doing well. Red Stripe in process of being transitioned to US production, brewed at City by this summer. Brewing it in US will enable DGUSA to ramp up investment. It looks to double brand over next several yrs. DGUSA currently looking for new ad agency for Red Stripe. DGUSA considers Red Stripe part of what it calls “discovery” beer brands. Sheila had lots more to say on DGUSA’s place within Diageo, opportunity of selling spirits-branded PABs and more. More from our conversation with Sheila next issue.

Diageo reported solid 9% organic operating profit increase to $2.9 bil in its first fiscal half thru Dec 2011. US oper profits about 40% of Diageo’s total at $1.17 bil. That’s up 5% organically, even with flat volume on increased prices. But North American operating margin an eye-popping 40%. Recall, DGUSA 11% of Diageo’s North American sales (amounts to about $600 mil annually). Diageo said beer volume even, and ready-to-drink volume down 2% in 1st half, but organic net revs for beer up 3% and flat for ready-to-drink. Noted Diageo: “The launch of Guinness Black Lager into the growing discovery beer segment, together with the growth of Guinness kegs, Parrot Bay pouches, and Jeremiah Weed ready-to-drink offset weakness in Smirnoff ready-to-drink.”

Competition between top 2 brewers already heating up in early Feb. Yesterday, AB sales veep David Almeida sent distribs details of AB’s new “Fuel the Future” initiative to gain 10,000 incremental tap handles from MillerCoors, offering $300 per pop, everywhere except Mich (where presumably it’s not allowed). AB is investing $1.5 mil “for this incentive kicker and [we] are requesting wholesalers to co-op $1.5MM through incremental CPC dollars. This combined $3.0 MM will create great excitement throughout our entire selling system…. It’s a very simple incentive. You replace a competitive MillerCoors tap handle with any AB brand, and earn $300 per tap.” AB is seemingly doing this in response to MC “$1,000,000 Reward” program that also appeared most places: “Bounty: Grab Some Buds,” offering $250 per handle to replace Bud handles with Coors Light. That incentive goes from next week thru mid-Apr and caps at $1 mil. Sales prexy Ed McBrien wrote distribs: “We all know Bud’s draft distribution continues to be disproportionate relative to its performance.” On MC flyer, picture of Bud handle sez underneath: “America’s 3d Most Wanted” and sheet lists offenses: “impersonating the sales leader, falsely claiming the title of ‘king’” and “dropping to No3 in sales.” Description: “White and Red (presumably from embarrassment… often seen wearing a crown and bowtie, delusions of grandeur” and “believes he is the official sponsor of everything.” Somewhat surprising that such heightened rhetoric and dueling incentives starting this early, especially since Jan sales strong for many.