A tuff start.  Thru Apr, domestic brewers’ taxpaid shipments -1.45 mil bbls, -2.7%, Beer Inst economist Michael Uhrich estimates.  Big drop in Q1, -1.6 mil bbls, -4%, offset slightly by Apr bump, +1.3%.  Meanwhile, imports +207K bbls, 2.6% in Q1.  So, known US shipments off 1.25 mil bbls, 2% so far.  Will it get better?  During recent webinar, Michael said he expects 2018 shipments to be off 1-3%, an unusually pessimistic forecast and a broad range since industry “faces a lot of uncertainty,” especially on costs.  If he’s right, would be 2d-straight down yr, following 3 slight gains.  Would bring US shipments down to lowest level since 2011, more than 8 mil bbls, 4% below 2008 peak.  And that’s at top end of Michael’s range.  Then too, off-premise volume off 1.1% yr-to-date thru May 12.           

High End Will Drive (Very) Modest Industry Growth 2018-2020, Bruce Believes  Sluggish volume surely top ’o mind at Beer INSIGHTS Spring Conference in Chicago.  But different speakers laid out different paths to return to “beer growth,” as Brewers Assn director Julia Herz put it, a phrase she prefers to “category health.”  Constellation Brands Beer Div’s CCO Bruce Jacobson did not put a number on 2018.  But he repeated CBBD’s projection that biz will pick up modest 2 mil bbls 2018-2020, just 0.3%.  That growth, CBBD believes, will all come from high end, avg retail price over $25/case.  High end will grow 11+ mil bbls while mainstream sheds 9 mil bbls.  CBBD far more optimistic about rev growth tho.  It sees beer $$ sales posting 4.9% CAGR during same period, outperforming both spirits and wine.  Why’s that?  Beer still behind spirits and wine vis a vis premiumization, so more oppy for trade up.  Plus, CBBD expects beer to grow faster on-premise, which drives up $$.  

Flavors Doing Industry Favors Helping to drive high end: FMBS, seltzer and cider, separate panel said.  Lotsa run room for flavor, Mike’s Hard sr director Dan Wandel stressed, as flavor options drive growth across bevs/food.  Malt bevs “woefully underdeveloped,” in Dan’s view.  Just 11% of beer is flavor, he figures, vs close to 30% in spirits. Dan seconded by AB’s veep of Value & Beyond Beer Chelsea Phillips and Boston Beer’s Head Cider Maker Ryan Burk.  They point to sessionability, variety, ABV, health/wellness advantages flavored bevs provide.  Ryan sees lotsa potential in cider, natch. Segment bounced back with 7% growth YTD in Nielsen scans, driven by Angry Orchard Rosé and small craft players.  Given seltzers already in yr 2 of huge growth (more than doubling YTD), high repeat sales, still-low penetration, tons of oppy there, say Dan and Chelsea.  

Another Growth Area: Taprooms  Taproom volume expanded by 1+ mil bbls, 60% last 2 yrs, 40% of craft growth.  And that’s at very sweet price/pint.  Model can be very profitable, as data provided by Barrio Brewing’s Dennis Arnold shows.  How profitable?  How about 50%+ operating profit margins?  Distribs, retailers and 3-tier purists have beefs, but taprooms here to stay.  They’re a source of growth, brand building and great oppy to connect fresh beer with “beer lovers,” a phrase Julia Herz prefers to “consumers.”

Beer Needs to Win At Retail, with Women and Wellness  Julia also laid out her vision of how to get back to beer growth.  She sees “3 buckets of opportunity”: winning at retail, wellness/health and women/diversity.  Winning at retail entails “romancing the beer,” especially draft.  Line cleaning, offering samples, “fractional pours” (i.e. 4-oz) and food pairings lead to significant increases in on-premise sales, BA data shows.  Another way to romance beer: increase presence in culinary schools, still “biased” in favor of wine.  Key to diversifying culture of “beer lovers,” and reducing gap between % of men who drink beer (54%) vs women (32%): “break the halo” that still links beer with macho.  That entails bringing more women “into the space” (BA just hired a diversity ambassador) and removing “conscious and unconscious” boy/bro mktg that lingers.  On health/wellness, mktg restrictions make education about benefits of moderation a tuff message to get across.  But Julia believes benefits (heart health, bone density, etc) need more exposure.  At same time, negative myths (“beer belly” and “beer is fattening”) need to be debunked.  These issues “take time” to address, Julia knows.  May mean “one conversation at a time,” whether with retailers, other biz partners and/or (not-yet) beer lovers. 

Gotta Simplify Shelves to Drive Growth, Sez Bruce  Earlier, Bruce talked about CBBD’s retail strategy, Shopper First Shelf, which CBBD firmly believes will drive high end and is key to “long-term total beer growth.”  In-store beer coolers a “distinct advantage” for beer, Bruce insists.  But they gotta be simplified.  One key: fewer SKUs.  CBBD believes 1 in 5 beer SKUs can be cut and “consumers would not care.”  Based on work in Seattle and Raleigh, CBBD identified where cuts should come.  A bit counter to notion that high end will drive growth, about half of the SKUs that need to go are craft brands not selling thru.  Then too, lotsa same flavors in FMBs, second-most “redundant” segment. 

High End Math “Doesn’t Work” Sez MC’s CMO David Kroll “Our industry can only get to qrowth if each price tier is healthy,” MillerCoors CMO David Kroll insisted, countering Bruce’s belief high end can drive industry back to growth.  “The math doesn’t work.  Sorry Bruce, it just doesn’t.... We can’t get the industry back to growth until we get” premium lights and economy “back to health.”  This of course is MC (and AB) mantra, understandably enough, since MC still has 90% of its biz in mainstream, AB about 80%. Economy segment especially important to recruit new beer drinkers, said David.  Who’s right?  Beer volume grew in 2014 thru 2016, as high-end gains offset mainstream declines.  And that offset gets easier as high end expands.  But that wasn’t case in 2017 as imports/crafts slowed, mainstream decline steepened.  That’s story so far this yr too.  Thru May 12, 4.9% decline in premium and 1.7% decline in economy overwhelmed above premium’s 4.3% gain in Nielsen.

The 2018 Craft Brewers Conference, 14,000 people strong, took place amidst beautiful sunshine in cool town (Nashville), but not everything rosy these days. In fact, craft now crazily chaotic, encapsulating everything from great growth to imminent catastrophe.  On program, top Brewers Assn execs celebrated excise tax reduction victory, independent and entrepreneurial spirit of BA craft (the seal), craft arrival as “global happening” and more. Speakers briefly acknowledged some of tuffer new reality, even while many craft brewers still growing (especially smaller ones). Behind scenes lotsa folks talked about trouble ahead.  One top sales exec called this undercurrent a “palpable sense of doom,” (a sales guy!) while another agreed total scene far worse than numbers suggest. These are more difficult times. Craft volume up 1.4% in Nielsen all outlet yr-to-date thru Apr 28, down 3.5% for 4 weeks (includes Shock Top, Leinie and acquired craft). Founders, AB and MC acquired craft accounted for 63% of craft growth in IRI YTD.

Shakeout spreading, already including some hi-profile collapses like Green Flash and Smuttynose, tho both attempting comeback under new owners. Lotsa craft brewers built too much capacity and took on too much debt.  One of biggest watch outs at CBC came from economist Bart Watson: capacity utilization fell to 56-57%. Making it even tuffer for those who expanded capacity too much and not growing as fast: about 75% of craft growth in 2017 came from brewers only open since 2014. They collectively grew 53%. Craft brewers that opened in 2013 or before up just 1%. And 40% of 200+ regional craft brewers (15,000 bbls or more) declined in 2017. With stats like these, easy to see that many of those that built big breweries during go-go years won’t get growth they planned. Then what? 

BA prexy Bob Pease and BA chair Eric Wallace hammered theme of BA seal, now adopted by 3300 brewers, representing 70% of BA volume.  Eric (of Left Hand) also gave fiery speech attacking big brewers for “rampant violation of trade practices and exclusionary tactics,” “deceptive packaging designs,” “denigrating and expensive marketing campaigns” and much more. In contrast, craft brewing “a noble pursuit for a great cause.”  Eric’s remarks represented a ratcheting up of rhetoric vs big brewers.  His speech and other comments prompted open letter from Molson Coors chairman Pete Coors, ironically a longtime supporter of craft brewers. Such rhetoric, in Pete’s view, does “great disservice to the entire beer value chain,” “insults” big brewers and their partners and destroys unity needed to battle beer’s common enemies.  Oddly, this came about just mos after big and small brewers celebrated unified efforts to get excise tax break for all, and recognition that unity needed to extend it. There are even fledgling attempts to work together to improve category health.  But would big and small brewers really be on same page?  Given competitive nature of beer and long-time positioning of craft, perhaps this tension cannot disappear.  If there’s “Better Beer,” in Jim Koch’s construction, inevitably there’s “worse beer.”  Jim and others argue craft brewers need to distinguish themselves from big brewers to maintain pricing and financial health.  Craft has always sourced volume from big brewers, a much easier target than wine/spirits.  What’s changed in that dynamic?  Craft slowed too and big brewers now sourcing craft volume.  That only increases tension.

Much in common in comments from AB InBev ceo Brito and Molson Coors ceo Mark Hunter discussing their respective Q1 US performances.  That’s not surprising perhaps, since they share similar volume trends in US, face similar tuff sledding for mainstream beers that dominate their portfolios, seek to build their above premium biz.  Each also has achieved much better profit than volume trends long-term, (tho each took profit hits in US in Q1).  Both Brito and Mark focused on weather as key culprit for soft US volume in Q1, which they pegged at -2.3%.  “Of course, that’s all due, we think because of the cold temperatures we experienced in the quarter, right, way worse, like 10% worse than what you would have seen in other years,” said Brito.  (For all of ABI’s metrics, we’ve not seen this one before.) “Our belief is a big part of that [2.3% decline] has to do with a very poor weather year on year,” Mark offered.  While Feb 2017 was “second hottest February on record,” he added, “it was awful this year and beer is affected by that.” 

Then too, Brito and Mark focused much more on share trends than volume trends.  “We lost 50 basis points,” said Brito.  “That’s much better than we had - 20 basis points at least better that what we had on average over the last three quarters and the last year.”  Also, “both Bud and Bud Light saw sequential improvements in terms of their share within their respective segment.”  Bud Light lost less share; Bud held share in premium full calorie.  AB gained more share in above premium, tho lost it in below premium.  Mark noted MC’s “consistent” mkt share performance several times on his call.  Mark was talkin’ qtr-by-qtr in recent yrs, but on 12-mo basis, MC consistently lost 0.5-0.8 share each of last 9 yrs, just as AB consistently shed 1 share per yr same period (except 2012), INSIGHTS estimates.  Mark also cited continued share gains in premium light (at least for Miller Lite in Q1), more recent share gain in economy, tho share loss in above premium.  Each also pretty happy with Q1 rev/bbl per bbl trends, tho AB had positive mix impact, MC a negative impact.

And tho each acknowledged category health issues, neither seemed overly concerned.  Brito again spoke positively about category expansion framework approach it acquired along with SAB and that framework’s promise to attract new consumers (including more women), bring beer to new occasions (meals, and ”high energy” parties) and shaping ABI’s future portfolio in ways that “gives me hope that we can get this industry again to growth.”  Mark reminded that US beer biz still a “great place to compete from a margin and profit pool perspective,” that there’s still tons of oppy, especially in above premium, and that he’s “not unduly concerned by some of the short-term trends we have seen from the industry demand perspective.”  Improving category heath, MC prexy Gavin Hattersley reminded, “takes time and we’ve seen that in other markets, other developed markets around the world.”

Finally, Brito and Mark each expressed confidence in their current strategies and personnel.  Noting AB’s progress in above premium and share trends, “all in all, we are more confident this year in terms of our brands, in terms of trends...but also the innovation calendar we have which is more active than last year.”  And [new AB prexy] Michel Doukeris “is a very strategic and commercially savvy person that did some interesting moves in terms of people and we feel the team is a very strong team to do what needs to be done in the US.”  Similarly, Mark insisted “despite the recent headwinds we have been facing, we believe we have the brands, plans and people to drive increases in profit and free cash flow and ultimately, to reach our goal of volume growth.”  In addition to seeing above premium oppys, each of these execs expressed optimism that new mktg tweaks will this time improve trends for their flagships: Bud Light, Bud, Coors Light and Miller Lite.

Molson Coors underlying EBITDA down 18.5%, MillerCoors shipments down 6.7% and STRs down 3.8%.  MillerCoors over 70% of Molson Coors earnings, so its steeper declines, exacerbated by ordering glitches in Golden, really hurt. Stock dropped 15% that day. It’s now down 45% from its peak.  Lost about $11 bil in value. Recall, Molson Coors paid $12 bil to buy the 58% of MillerCoors it did not own in Oct 2016.  That stock drop happened even tho at end of 2017, Molson Coors volume 62% higher, EBITDA 81% higher and free cash flow higher than at end of 2015, as ceo Mark Hunter pointed out on conference call. Yet stock stays down. Mark also noted Q1 not “indicative,” represents only 14-15% of TAP’s total profits for yr.  

MillerCoors trends getting worse so far in 2018. That’s partially because industry getting tuffer, as top Molson Coors execs note. They say strategy to build profits and objective of stabilizing then growing volume stays the same, but timeline longer. Yet challenges continue to mount. Wall St analysts had tuff comments like “we see little improvement on the horizon” (Goldman Sachs) or “structural declines… likely to persist” and “the corporate algorithm can’t work with that level of weakness” (Consumer Edge).

Many distribs somewhat alarmed by recent results. They wonder how much more MC will lose and what that means for their biz. (Same could be said for many AB distribs.) Last yr, MC antagonized its distrib network with shift to 50-50 split on discounts and other moves they believed favored brewer at wholesaler’s expense.  Those relationships didn’t really recover, especially amidst continued soft MC sales and other contentious issues. This yr, many distribs in Midwest and west could not even get MC beer they ordered. Yet MC execs continue to insist they are on right path and have answers, distribs say. 

MillerCoors execs got compensated last year as if all was well. In addition to stock/options Molson Coors ceo Mark Hunter and MillerCoors ceo Gavin Hattersley got over 100% of available bonus in all, 120% and 102% respectively.  Mark’s total compensation package at $8.9 mil and Gavin’s total package at $4.9 mil, SEC filings revealed.  Bonuses calculated measuring profit mainly: 25% based on free cash flow, 25% on pretax income, 25% on net rev per bbl and 25% on volume.

Sales got softer still in April 2018 and MC ain’t yet out of the woods on its production issues in Golden.  MC down 5.9% for 4 weeks and 3.4% yr-to-date in Nielsen all outlet thru Apr 28. Coors Light dropoffs virtually as steep as Bud Light in 2018 (down 6%) and Miller Lite down 2.5% YTD.  While MC gaining 0.8 share of declining economy segment and 0.5 share of declining premium, it’s losing 0.9 share of growing above premium segments.

It was a glass half full kinda qtr (tho stock dropped).  AB grew global revs 4.7% to $13.1 bil, EBITDA 6.6% to $5 bil in qtr. That’s way better than most consumer packaged goods cos these days.  But US shipments down 4.4% (see above), revs down 2.6% and US EBITDA down 5%.  Key mkts like Mexico up in mid-teens and Colombia up double digits. So there remains a disconnect with continued softness here, keenly felt by distribs.  Asked on conference call to identify encouraging signs in US, ABI ceo Brito pointed to “improving” share trends, tho still down 50 basis points, “very healthy brand mix” with net rev per bbl up 1.9%, above premium “continues to accelerate,” gained 80 basis points of share. Even Bud and Bud Light “saw sequential improvements” in share.  “We see progress in our commercial strategy,” said ABI about US. Some of this may have sounded like a foreign language to distribs, many dropped double digits in Apr.    

Yet ABI did deliver “a good start to the year” globally, as Consumer Edge’s Brett Cooper said and “resilient” results, as per Bernstein’s Trevor Stirling. Strangely, stock bounced up before settling down.  It’s down 27%, over $50 bil from peak, but mkt cap still $186.6 bil.  In Q1, ABI surprised itself: results “slightly better than we expected.”  And it promised better to come. “We remain confident that growth will accelerate for the balance of the year, primarily in the second half.”  ABI’s “biggest commercial campaign ever will be for World Cup this summer. But “our World Cup Campaign will be more limited” in US, global Bud veep Brian Perkins told Ad Age.  That makes sense, since US team not in tourney and US soccer audience ain’t huge.  It’s mostly aimed at BRIC countries (Brazil, Russia, India, China) plus UK and other mkts Bud recently entered. So world’s biggest brewer’s biggest-ever campaign ain’t really about its biggest mkt.

Asked if category could ever get back to growth in US or AB mkt position could stabilize, Brito zeroed in on ABI’s “category expansion framework” which “taught us that there are many occasions where beer is just not present or very under-represented.”  Ultimately, beer can get back to growth (see below). Meanwhile, beer biz down 1.7% in Nielsen all-outlet yr-to-date thru Apr 28 and ABI down 3.4%, including 5.5% drop in an awful Apr, exacerbated by Easter timing, weather, 1 less sell day. Bud and Bud Light each down 6% YTD.  There’s still lotsa work to do here, while AB achieves growth targets elsewhere. 

Not a lotta plus signs in Q1/12-mo beer shipments table below.  Sure, Constellation’s still kickin’ it.  And Boston reversed its 2016-2017 losses with bang up Q1.  But Boston’s just flat for 12 mos and its beer-only volume still well in the red.  Otherwise, all minus signs for Q1 and 12 mos for top 6 players.  Then too, Q1 total US shipments down estimated 2.9%; 12-mo trend sits at -1.2%.  That’s while spirits volume still rollin’ along at +2%. 

Top 2 took it on the chin agin’ in Q1.  AB shipments off 910K bbls, 4.4%, at 19.8 mil bbls.  That was 6.3 mil bbls lower than AB shipped in Q1 2008 (AB’s peak year).  Also, last time AB shipped less than 20 mil bbls in any single qtr: Q4 1995.  MC had even tuffer time in Q1: shipments also off 800K+ bbls, 6.7%.  MC attributed about 380K bbls of that to logistics snafus in Golden as it moved to single ordering system there.  MC expects to recoup those bbls in back half of 2018.  So, MC’s underlying trend more like -3.8% in Q1, not so pretty itself, and a bit steeper than 2017 dropoff.  Both AB and MC cited soft overall US biz in reporting their even softer Q1s.  For 12 mos, AB shed nearly 3 mil bbls, 3.2%. MC drop was half-pt steeper, down just below 2 mil bbls.  Yep, that’s another 5 mil bbls off the top ’o the biz last 12 mos.  Ain’t no one making that up. Not even Constellation, even as it continued up in 10% range for Q1 and 12 mos.  Constellation gained almost 2 mil bbls for 12 mos, covering MC loss. 

HUSA dropoff steepened to high single-digits in Q1.  Down about 5% for 12 mos. So is Pabst.  That’s a combined loss of 650K bbls.  But Boston shipments jumped 15% in Q1. It had easy comp (-15% in Q1 2017), plus strong tea, hot new cider (Rosé), hot hard seltzer and better seasonal numbers, tho Boston beer biz still down.  Life’s better among #7 thru 10.  Yuengling up 4% thanks to expansion; down low-mid singles in established mkts.

Diageo Beer Co up modestly; NAB down low singles.  And Mike’s rockin’ at high teens rate, riding especially strong growth in White Claw seltzer.  All this suggests vast ocean of All Others, mostly craft, collectively up slightly in Q1, +2-3% for 12 mos.  Per usual, that’s very mixed bag of solid gainers (Founders, Firestone Walker, Stone), saggin’ strugglers and screamin’ newbies.

How do you want to look at it? AB sales-to-retailers down 3.3% in Q1.  That’s slightly worse than 3% drop last yr.  But industry soft, down 2%.  So AB actually lost less share, down 50 basis points, it figures.  AB also outperformed MC as MC STRs down 3.8% in Q1 (down 2.9% last yr).  AB shipments down over 900,000 bbls, 4.4% in Q1, a point steeper than STRs.  AB’s rev per bbl up 1.9%, “driven by revenue management initiatives and  positive brand mix.”  That’s a half point better than MC, which got rev per bbl increase of 1.4%, with higher net pricing but “negative sales mix.” 

 Meanwhile, AB accelerated its above premium share gains to 80 basis points (recall AB prexy Michel Doukeris has stated goal to grow above premium twice as fast as before), led by Ultra up “double digits.”  Both Bud and Bud Light had “improved share trends” down 35 basis points and 70 basis points respectively. But value “underperformed the industry” with difficult comps on Busch (Super Bowl ads last yr).  “We see progress in our commercial strategy,” said AB. “Near Beer performed well” including “Natty Rush and Spiked Seltzer grew by triple digits during the quarter.” So ABI  commentary considerably more upbeat than its numbers (then again, it didn’t talk Apr—see below). 

 Globally, AB EBITDA up 6.6% in qtr, and “own beer volumes” up 0.5%, including double-digit gains in Mexico and Columbia.  Earnings beat analyst estimates and stock up 2-4% today on European exchange.   But as Bloomberg noted, “AB InBev’s shares have lost about a quarter of their value since” SABMiller deal.  That’s not as steep a % drop as Molson Coors, but ABI shares lost over $50 billion in value.  Both Molson Coors and ABI drops should also be viewed in broader context; consumer packaged goods stocks are taking it on the chin in the markets

At TTB webinar last fall, regulators showed slide that included common brewery sales incentives for distrib employees as “examples” of “commercial bribery” law violations.  Especially in context of TTB stepping up trade practice enforcement – 50 ongoing investigations − that made distribs nervous.  Prompted NBWA counsel Paul Pisano to seek clarification of whether specific scenarios − like supplier offers sales incentive to distrib to sell more of Brand X or all of supplier’s brands − would be violations.  TTB’s response: “if the industry member is providing sales incentives to the wholesale entity itself and not its employees, the commercial bribery provisions would not apply unless the wholesaler was acting as a mere conduit” between officers, employees or reps.  Or, as Paul summarized: “It is permissible for suppliers to offer incentives to wholesaler companies.  However, the wholesaler companAy must have control of where the money goes and cannot be a ‘mere pass through’ for the supplier to an individual distributor employee.” 

What’s a “mere pass thru”?  It’s when: 1) there’s any agreement “implied or explicit,” that incentive will be passed on to employees or; 2) it’s “obvious by the very nature of the item” that a pass thru “clearly contemplated” or; 3) distrib records don’t accurately reflect incentive as an “asset” of the distrib co (subject to tax) as opposed to a personal asset of recipient.  Distribs need to keep records for 3 yrs, TTB reminded.  Then too, for incentive to be illegal, has to involve “exclusion” of competitors’ product, a high bar TTB has had trouble proving in past.  Also, there’s gotta be “similar” state law banning such activity.  But “TTB does not provide a public list of the state laws it considers ‘similar’ for these purposes,” Paul notes.  So what?  So this issue came up at NBWA conference by Paul and ex-chief TTB counsel Rob Tobiassen.  Tho TTB hasn’t made a commercial bribery case since 1990, Rob suggested that “commercial bribery has a ring to it” certainly a much more negative tone than “tied house” or “consignment sales,” which have so far provided “low hanging fruit” for recent offers in compromise won by TTB.  Some incentives may “cross the line,” and TTB may “start to look there,” Rob suggested. 

TTB Has Its Own Incentives  TTB needs to show it’s doing something to clean up the mkt, Rob pointed out.  NBWA member input shows lotsa “frustration,” Paul told INSIGHTS, as pressures abound from competition, suppliers and “retailers with their hands out.”  Speaking of frustration, lotsa folks scratchin’ their heads over Mass ABCC letting AB Boston branch off hook from charges of providing $942K worth of coolers/towers to retailers based on technicality that the brewery, not the branch, gave the goods and could have reclaimed them.  Meanwhile, TTB “clearly out there,” said Rob.  TTB director Bob Angelo set out 2 tuff “new norms” on trade practice investigations.  First, TTB intends to complete investigations, documenting evidence with eye on license revocation.  Second, when TTB does consider offers in compromise, the $750K paid by Craft Brewers Guild now “the starting point, not the ending point” Angelo indicated.

State shipments data shows broad losses for 4 of top 5 suppliers in 2017, while Constellation gained across the board.  Table shows top suppliers’ shipments trends in 42 “reporting” states, broken out by region, plus 10 big-volume mkts among those states. AB down in every region and all but 3 of these states.  Lone gains were in UT, OR and WA, with latter 2 boosted by its craft partners.  Regionwise, AB declines consistent and in narrow range, with almost all between -2.5% and -3.5%.  Biggest % hit: -4.1% in NJ-PA/Mid Atlantic region.  In contrast, wider range in MC drop-offs.  Off just 0.2% in Mtn states, 1.2% in WN Central and 1.6% in WS Central.  That’s a big swath of the middle of country where trends better, tho not many big mkts outside TX, AZ, CO.  But MC stung in NJ-PA too, -4.6% in SEast, -4.4% in Pac and near 4% in New Eng and heartland EN Central region. 

In sharp contrast, Constellation up at least 4% in every region, +7% or more everywhere but Northeast and really rocked Pac states, dominated by CA, where it grew 13%.  HUSA up slightly in SEast, +1.6% in WS Central and off just 1% in Mtn states.  Got whacked in Pac tho, and down 5-6% in Midwest.  Pabst nearly held volume in WS Central, and off just 1.5% in Mtn region, but down 4% or more in northeast and Midwest.  Others collectively up in every region, but less strong than recent yrs, reflecting craft slowdown.  In fact, Others up just 0.1% in SEast, 1.5% in NJ-PA, 2% in Pac.

In 23-mil-bbl CA mkt, AB and MC each down in 4-5% range each of last 3 yrs.  Top 2 shed 1.8 mil bbls and 7.5 share during that period.  Constellation gained 1.3 mil bbls same 3 yrs, 5.6 share.  CBBD blew past MC to grab #2 spot in CA last yr at 20.7 share, vs MC’s 18.3.  AB down to 32 share in CA.  Others collectively shipped 5 mil bbls in CA, 21.6 share, tho flat in 2017.  HUSA hit hard in CA last 3 yrs.  Gave up almost 300K bbls and more than 1 full share.  After holding dropoff below 2% in TX 2014-2016, AB down 3.3% there in 2017.  Dipped below 10 mil bbls and below 50 share.  MC held better, off just 1.4%.  Constellation “slowed” to high single-digit gain, but neared 2 mil bbls in TX, grabbed just below 10 share.  HUSA gains there really slowed, but still up and has 6 share in TX.  AB holding share better in FL than most other big states, off less than 1% there in 2017.  MC took 5% hit.  Constellation up near 10%.  HUSA had good yr in FL too.  Gotta note CA, TX and FL, 44 share of Constellation volume, over half its gain last yr.   

Volume down in each of big EN Cent states in 2017.  AB and MC off about 3% in each of IL, MI, OH and WI.  Constellation strong in each.  In PA, MC still over 1/3 of biz and almost 8 share ahead of AB.  Each off 4% there in 2017.  Pabst, Constellation and HUSA are modest players there (2-3 share each).  Others nearly 1/3 of PA mkt, just 3 share behind MC, with still significant Yuengling share. Shipments to GA down 3% in 2017. AB and MC especially soft.  Constellation only gainer among top players.  CBBD nearly caught HUSA in AZ, where each near 7 share.  MC held share in AZ for 5 yrs, AB slowed losses, tho each down in 2017.  Here’s how reporting-state regions break out: NE= ME, MA, NH, RI, VT; MA= NJ, PA; SE= AL, FL, GA, MS, SC, TE, WV; ENC= IN, IL, MI, OH, WI; WNC= IA, KA, MN, MO, ND, NE, SD; WSC= AR, LA, OK, TX; MTN= AZ, CO, ID, NM, NV, MT, UT, WY; PAC= CA, HI, OR, WA.

You know it’s a bad mo when 5 of the top 6 import brands lose volume: Corona Extra (-5.9%), Heineken

(-5.7%), Stella Artois (-7.2%), Dos Equis (-6.1%) and Corona Light (-15.5%) in 4 weeks thru Apr 28 in Nielsen all outlet.  All except Stella now down yr-to-date.  With one less sell day, lead up to Easter in Mar, lousy weather, April especially tuff, according to anecdotal reports. Indeed, we already heard of double-digit drops for a number of AB distribs.  But sales coming back in early May.  So as bad as these numbers are, it’s just 1 mo, distorted by several effects. Still, yr-to-date ain’t great.   

Back to scan: 8 of the top 10 above premium brands overall declined for 4 weeks in Nielsen.  Only Michelob Ultra and Modelo Especial up, and their respective gain paces for 4 wks were 9.2 and 11.1 pts off their 2017 scan trends.  But that’s just a couple of the notable no-bueno trends from Nielsen all-outlet scans for 4 wks thru Apr 28.  Here’s more:

·         Total volume -4.2% for 4 wks, YTD trend -1.7%.  Dollar sales off 2.7% in Apr, -0.3% for 4 mos.

·         Above premium volume flat for 4 wks.  When was last time that happened?  Imports up just 0.3%, superpremiums +4.6%, craft -3.5%, FMBs -1.7%s, tiny cider segment +5.7%.  Meanwhile, premium volume -7.9%, below premium -3.6%.  Are we trading premium volume for below premium yet? 

·         Among top 10 growth brands, along with Ultra and Especial, you got 2 seltzers, White Claw and Truly variety packs, Corona Familiar and Premier (combined for 0.7 share of volume 1 share of $$), Angry Orchard Rosé, and 3 below premium brands: Natty Light, Key Light and Key Ice.  Key Light avg case price down to $14.14, more than a buck less than Natty Light, which shaved 70 cents/case off its avg price in most recent period.

·         Every top 10 premium brand down for 4 wks, 9 of 10 YTD, with only Yuengling Lager hanging on to 3.5% gain thru Apr. 

·         Top 4 premium brands each down mid-high singles for 4 wks: Bud Light (-8.5%), Coors Light (-8.4%), Miller Lite (-4.8%) and Bud (-7.6%).  All except Lite down about 6% YTD.

·         Top craft brand families fared no better in Apr: Blue Moon (-7.7%), Sam Adams (-12.8%), Sierra Nevada (-2%), New Belgium (-15.8%), Shock Top (-9.4%) and Leinie Shandies (-29.9% !?!).

·         AB and MC each down near 6% for Apr; each off 3.4% YTD. Pabst, HUSA and NAB each down 5-6% for 4 mos, steeper for 4 wks; Diageo Beer went negative in Apr. 

·         Constellation slowed to +6% in Apr, but still picked up almost full share, 1.3 share of $$.  Tho Sam stung, Boston Beer still +9% in Apr, +13% YTD.  Mike’s slowed but still up double digits both period, gaining 0.2 share of volume, 0.3 share of $$.

It’s gotta get better from here, right?