Modelo prices to Barton expected to go up next spring, Constellation ceo Richard Sands told Wall St.  Anticipates “less than 5%” hike, then Barton will “focus on market by market price points.”   He expects “a little bit of consumer shock” that will “flatten Corona’s growth rate for some period of time.”  Constellation looking for single-digit Corona growth next yr, maybe even a “flat” yr.  In latest qtr, Barton Beers revs up $18 mil, 11% thru Nov.  Up 10% for 9 mos.  Barton’s growth rate apparently not affected by Sep 11 and aftermath.   But its oper income growth slowed in latest fiscal yr.  Barton oper income (including spirits division) up just 3% in 3d qtr; up $7.4 mil, 5% to $143 mil for 9 mos.

Loudest voice raised against liquor ads so far: Rep Frank Wolf, who has threatened Congressional hearings and legislation to stop ‘em.  His rhetoric over the top on Jan 1 Newshour with Jim Lehrer when he duked it out with DISCUS prexy Peter Cressy. Wolf wailed about NBC’s “unbridled corporate greed” and predicted ads will “bring a lot of increase in drunk driving, increase in teenage suicide, increase in homicide and will create many, many problems.”  Cressy’s key points: 1) US govt and extensive research has concluded that ads don’t cause drinking; 2) drunk driving and drinking among youth has declined in a “era of unprecedented advertising by beer and wine”; 3) “if beer and wine can be on television…certainly we should be allowed to.”  Note it was industry-wide liquor spokesman, not Diageo exec, who defended ads. 

Power of Beer Ad $$ CBS chief exec told press that network won’t join rival NBC in accepting spirits ads be-cause, “We don’t feel it is the right thing to do.” But Wall St Jrnl reported that CBS execs privately said net-work “doesn’t want to alienate beer manufacturers.” Makes sense since CBS airs lots of sports with big time ad dollars from beer while NBC airs only basketball and is losing contract after this season.

Two-year struggle to get NJ beer distribs same basic protections as wine & spirits distribs have there—primarily that suppliers need “good cause” to terminate even if supplier is small % of distrib’s biz—stymied as guv vetoed bill passed by House and Senate last yr.  Weirdly, distiller’s assn DISCUS trumpeted defeat of this “monopoly protection legislation “ in press release, even tho amendment that would have forced distillers to leave newly acquired brands with former distrib had already been stripped out of bill.  Then again, one key member of DISCUS is Diageo; its Guinness folks opposed beer provisions, we hear.    

Big Pitt Coors-AB-Others distrib will acquire Mark Thompson Inc, another AB distrib in Pitt area, owner Frank Fuhrer told Pitt Post-Gazette this week. Fuhrer will add a half-mil cases to bring his Bud biz to about 5 mil cases, total biz to 13 mil cases.

AB up 52,000 bbls, 1% thru Sep in Fla. Gained 0.5 share to 58 for 12 mos. Miller down 2.4 share to 18.5 for 12 mos. Off double digits for 6, 9 and 12 mos in state. Dropped 234,000, 12% thru Sep. Biggest gainers: Guinness Bass Import Co up 86,000 bbls, 95% on strength of Smirnoff Ice. At nearly 2 share in state in 2001. And Gambrinus up 57,000 bbls, 17%. At 4.3 share for 9 mos. Coors up 30,000 bbls, 6%, but still only at 5.5 share. Heineken up 23,000 bbls, 7%, climbed to 3.7 share.

That’s preliminary figure from US govt. Follows 3.6% increase in pro-ducer price index (PPI) for malt bevs in 2000, 2.5% hike in 99. Compares to 2% increase in 2001 PPI for all finished goods, 3.8% increase in 2000, 1.8% increase in 99. Will healthy beer pricing trends continue in 2002?

While AB announced blowout 4^th qtr with sales-to-retailers up 5%, Miller and Coors performed better in 4^th qtr too.  Coors was up a couple points, compared to 1% drop for 1^st 9 mos and Miller close to even if you take out Molson, compared to 3-4% drop in 1^st 9 mos.  AB STRs, up just 0.8% for 1^st 9 mos, ended up 1.8% for yr.  So each of top 3 had 4^th-qtr retail trends several points better than 9-mo trends.  Why?  Clearly easy comparisons vs last yr’s 4^th qtr were a factor as well as unseasonably warm weather this yr.  Some media reports suggested consumption bump post-9/11.  Could that have played role too?  

 

Hard to believe anyone would complain these days about Mexico having disadvantage in North American beer mkt.  But Natl Beer Industry Chamber in Mexico prexy said recently that because of NAFTA “other companies are in a better position to take advantage of the US and Canadian markets,” reported Notimex, an internet news service.  US beer “displacing” Mexican brands in some border cities, this guy claims, because of cheaper prices that result from lower taxes.  US exports to Mexico increased sharply in 2001, up 35%.  But totaled just over 6 mil cases at avg value of $5.40/case, according to US Dept of Commerce. Compare: 121.2 mil cases of Mexican beer shipped to US last yr at avg value of $7.26/case.

“Wal-Mart sells more AB products than any other retailer,” wrote AB in its Team Talk mag.  Since 2000, AB has a National Retail Team “devoted… exclusively to Wal-Mart,” including an office near Wal-Mart hq, which works to build relationships and “drive sales.  For Wal-Mart, that comes through a focus on costs, unique products, promotions and data."  Turns out Wal-Mart has its own database that “provides item level sales updates from every store on the hour.”  Wow!!  AB hopes to become “sole category partner” for Wal-Mart's supercenters.  This yr, each of top 3 brewers was “assigned specific areas of the country" as category partner.  "Next year, Wal-Mart will select one brewery to develop the beer sets nationwide.”  To put it mildly, that slot will be highly coveted.