Schenck Corp of Orlando just bought Jim Taylor Corp. Schenck will pick up Tay-lor?s 1.3 mil cases and will sell about 11 mil cases of Miller, Coors, Pabst, imports, specialty, etc from its brand-spankin? new 325,000-sq ft warehouse. Jim, once one of largest Old Mil distribs, sold both his bizzes in 2001. Lotsa big city distrib deals in Fla in last 2 yrs, including Miami, Jacksonville, Tampa, Naples, Sarasota.

That?s in down mkt, where Miller and Coors each down 3-4% (tho Miller trends much better in supers recently in Calif). Bud down 2.5% and Bud Light up 7.5%. So Bud family up nearly 3% there, much better than natl avg. Total Calif AB trend dragged down by precipitous Michelob family decline of 12% (Mich Light down 1.6%), and 7% decline for Natural/Natural Ice.

That’s what prexy John Bowlin wrote in sober Nov 7 letter to salaried employees eligible for “incentive compensation.” “Our business results for 2001 have again been disappointing,” continued John.  “We have not grown volume or market share despite better marketing, improved execution at retail and stronger work in several other areas.  And we have not met our profit targets despite our efforts to increase margins and reduce costs.”  “I am frustrated by our results,” added John, as he explained why PM gave Miller a 26% lower rating than last yr, cutting bonuses.  “For 2002, we must create and flawlessly execute new initiatives to drive volume and profitability,” he concluded.  “In short, we must recommit and reinvent Miller—and we must do it together.”

Utah brewer with fun approach to Polygamy Porter (see last issue) is Wasatch, not Wastach.

Mirroring its cross-town rival Redhook, Pyramid also recorded 1% shipments gain in 3d qtr on Pyramid brands. But had $204,000 oper loss, compared to $206,000 income last yr. EBITDA down $939,000, 37% to $1.6 mil for 9 mos. Oct ?substantially ahead of prior year.? Pyramid plans a price hike in 1st qtr 2002.

While spirits cos are trying to mkt more like beer cos, print ad for Budweiser Red Label in latest New Yorker mag suggests that AB might take a page from spirits mktg style too.  First page has attractive young folks toasting each other in rain with slogan “a new exhilaration.”  Lists hip cosmopolitan cities New York, Rome, London, Hong Kong, and Buenos Aires, next to shot of bottle. Those are all Red Label mkts, according to AB web site.  The flip side is a product shot and poured glass that sez “a new expression.”  It’s a striking ad.  While AB appears to emulate urbanity of some upscale spirits ads, flip thru first few pages of a recent Rolling Stone mag and you can see major spirits cos one-upping baser side of some beer ads: 1) an ad for Jim Beam showing a buncha “contemporary adult” males at a bachelor party watching a stripper emerge from a cake; 2) an ad for Bacardi showing a young lad licking rum out of a lovely lady’s navel. 

Freddy Heineken announced that he will step down as chairman of the board next April.  At 78, he’s entitled.  But Freddy will still retain his 50.005% controlling interest in Heineken Holding which in turn has 50.005% of Heineken, the brewing co.   His daughter will be on board, and will someday inherit his shares, according to Reuters.  No change in strategy is expected.

Yet another sign that Guinness confident malternative / ready-to-drink segment for real: it’s lookin’ “very closely” at Pabst’s Lehigh Valley brewery, as well as “other options to increase our production and distribution,” communications director Gary Galanis told Allentown Morning Call last week.  Guinness had lotsa trouble filling orders for Smirnoff Ice this summer, especially on 12-packs.   Lehigh Valley plant’s 3+ mil-bbl capacity would solve capacity issues, leave room for much-anticipated other malternatives from GBIC. 

AB is “dependable” even in tuffer biz environment, AB cfo Randy Baker told Wall St this morning.  Contrasted AB’s expected 12% EPS growth in 2001 with “profit disappointments” at its 2 leading competitors.  While premium light segment growth has slowed to 3.5% in 2001 (compared to 5% annually for last 5 yrs), AB has “captured” all share growth in this key segment with Bud Light.  Gained 18 share of premium light since 1993, said Randy.  Though consumers increasingly prefer light beer, Randy also pointed out that “in contrast to competition” AB has “maintained viability” of its flagship Bud, which is still more than 1.5x bigger than whole import segment, he noted.  

Randy pointed to “some improvement” in sales trends:  AB’s Oct sales-to-retailers were up 1.6%, selling-day adjusted (there was 1 extra day).  STRs were up 6.1% on an “actual basis.”  Reiterated 2% volume growth goal for 2002.  Pointed out that when joint venture with Bacardi rolls out early next yr, AB will report 100% of revs and costs, but profit-sharing arrangement with Bacardi will be reported as marketing expense.    

 

Gotta see ad theme for Wastach Beer’s Polygamy Porter: “Why Have Just One?”  And tag line: “When enjoying our flavorful beverages please procreate responsibly.”  Predictably, Wastach got into flap with Utah regulators who tried to pass law banning religious themes in ads and billboard co that refused to run ads because they’re in “bad taste,” wrote The Economist mag.