International research continues to link moderate drinking with positive health outcomes. Just as a widely-reported UK study found earlier this year that moderate drinking, together with a handful of other healthy activities (exercise, not smoking, diet with fruits/veggies) extended mortality, a new study from the US links healthy behaviors with significant reductions in stroke risk. In a study of 115,000 health professionals, women who lived a "low-risk lifestyle" reduced their risk of stroke by 79%. Men reduced stroke risk by 69%. Five factors in a low-risk lifestyle: not smoking, a body-mass index under 25 in middle age, at least 30 minutes of vigorous exercise on most days, a healthy diet and up to 1 drink/day for women, 2 drinks/day for men. The daily drink alone led to a stroke risk reduction of 10%, the authors found. But, as in the UK study, it was the combination of these lifestyle factors that really drove the risk reductions.

Elsewhere, "moderate alcohol consumption is associated with a lower risk for all microvascular complications among type 1 diabetes patients," Dutch researchers found. Diabetic patients who consumed 2-5 drinks per week had risk reductions of 40-64% for three "microvascular complications: retinopathy, neuropathy and nephropathy. Wine drinkers fared best.

Not only diabetics, but those suffering from hypertension may benefit from moderate drinking as well. A study of over 5000 male physicians in the US with hypertension found that moderate drinkers reduced risk of heart failure compared to very light drinkers and/or abstainers. Those who consumed 8 or more drinks/week had a 62% reduced risk for heart failure compared to those who had less than 1 drink/week. Those who consumed up to a drink/day reduced heart failure risk by about 30%.

A research review from China of 38 studies found a significant reduction in risk of lupus among moderate drinkers (about 28%) studied for a period of 5-10 years, though no risk reduction was found in a group studied for less than 5 years. A review of an additional 6 case-control studies found "moderate drinking had a protective effect on the development" of lupus.

Finally, some mixed evidence on metabolic syndrome and alcohol consumption. American researchers found that those who consume in excess of the Dietary Guidelines - 2 drinks/day for men, 1 drink/day women - and those who "binge" drink raise their risk for metabolic syndrome. The authors took note that almost 60% of drinkers say they exceed the guidelines and about half of all drinkers admit to at least one binge episode per year. On the other hand, British researchers recently found that consumption of up to a drink per day significantly reduced the risk of metabolic syndrome (by about 1/3), though drinking at heavier levels "weakened" the benefits. Ref 2

Recent research continues to reiterate and refine health benefits of moderate drinking.  In last few mos, new studies showed those who “thrive” in old age more likely to be moderate drinkers than abstainers and suggested US drinking guidelines for older adults (1/day women, 2/day for men) may be too “restrictive.”  Just this week, new “mini-review” emerged that focused on “considerable body” of evidence that links moderate drinking to “significantly reduced risks of coronary heart disease” and less risk for stroke.  Then too, half of 45 studies show “significantly reduced risks of cognitive loss or dementia in moderate non-binge drinkers,” the authors wrote.  “Small amounts of alcohol might, in effect, make brain cells more fit,” as Science Daily explained.  Yet another study emerged this week that found lower risk for myocardial infarction among men at drinking levels below 4.55 drinks/drinking day, and less than 3.08 drinks/drinking day among women.  These findings about heart disease, stroke and dementia critical, as authors of mini-review noted, since cardiovascular disease and stroke are “2 of the top 3 leading causes of mortality in developed countries” and new dementia cases “diagnosed about every 7 seconds worldwide.”  One negative note: World Cancer Research Fund in UK warned that even light drinking raises liver and bowel cancer risks by up to 20%.  More on these studies in our Alcohol Issues INSIGHTS newsletter.

Happy New Year!!

Road to Granholm II at US Sup Ct getting more defined by the day.  In latest development, 6^th Circuit Ct of Appeals upheld US Dist Ct in Ky which tossed state’s requirement that Ky consumers who want direct shipments from vintners must have face-to-face mtg.  Appeals Ct agreed with lower fed ct that the law “discriminates in practical effect against out-of-state small farm wineries, and has not been shown to advance the legitimate local purposes asserted that cannot be adequately served by reasonably non-discriminatory alternatives.”  What’s more, law benefited in-state small wineries and Ky wholesalers, Appeals Ct ruled.  This sets up another direct Appeals Ct split, since 7^th circuit had earlier upheld Indy’s face-to-face requirement.  Recall too, Circuits split on whether Granholm applies to retailers as well as vintners.

Sixth Circuit took pretty expansive view of Granholm.  Distribs argued Granholm did not apply since Ky law was not discriminatory on its face.  In-person requirement applied to Ky vintners too.  But Appeals Ct rejected distrib argument, ruling Granholm “clearly acknowledged that statutes may also discriminate in effect.”  State law violates Commerce Clause, sez 6^th Circuit, if it discriminates “on its face, by having a discriminatory purpose or by discriminating in practical effect.”  But Court bought vintners’ argument that law created “economic barrier” to small out-of-state vintners who have trouble getting Ky wholesalers to carry their brands.  Noted too “wineries pay up to 50% of their profits to the wholesalers” and cited supportive FTC report on direct shipping that’s been criticized by other courts and distrib advocates.  Ct ruled face-to-face requirement “guarantees the Wholesalers a source of revenue that would not exist but for the statute.”  Wholesalers’ assn that defended law (state opted not to) didn’t present evidence that face-to-face orders necessary to prevent underage access.  Instead, state could simply require age-verification upon delivery, Ct suggested.  Finally, US Dist Ct could have opted to ban all direct shipping to consumers (a “nullification remedy”), but Appeals Ct found nothing wrong with lower ct judge’s decision to simply toss “unconstitutional” in-person requirement.  

Tho AB InBev stock fell below 10 Euros at 1 point in late Nov, it has since rebounded 60% to 16 Euros.  That’s still dramatically below peak.  But ABI “poised to rebound” wrote Chad Brand of Peridot Capitalist in column today, following up on his Biz Week recommendation last week.  “The combined company could have annual EBITDA of more than 8 billion euros,” he said, ($11 bil).  Even tho debt remains huge, with such strong cash flow (even after capital expenditures), “you can repay debt fairly quickly.”  ABI stock could jump another 50% in 3 yrs, he sez.   

In lieu of its typical natl sales conference, and undoubtedly for lots less expense, AB will host a different kind of meeting for distribs in early 09.  It’s called a “Leadership Summit”  and it’s for wholesaler equity mgrs in Houston Feb 10-11.   Gone are “Expo, Vendor Village or workshops,” according to Dec 22 note to distribs.  Insofar as we can tell, focus isn’t really on ads or programs.  Instead, AB described “objectives of the meeting” as to “Introduce new Anheuser-Busch InBev Executive Team” and “Build trust between” AB “leadership and wholesaler ownership,” “communicate vision, mission, values” “review key strategies,” “communicate expectations” and “promote interactive dialog.”  Interesting that to “build trust” is presented as a key objective of meeting. 

AB sez presentations will be “relevant to Wholesaler Ownership,” so attendance limited to equity mgr, successor mgr and principals “if they are active in the business.”  Wholesalers’ sales, mktg and op execs “should plan on attending the fall” 2009 “Sales and Marketing Communication Meeting.”   In past, AB’s natl sales conference was frequently a no-holds-barred extravaganza, intent on demonstrating to distribs (and partners) all the programs, ads and other tools that AB would bring to bear against mkt during peak-selling season.  But that kind of show of power is apparently less of a priority to AB’s new ownership.  Or maybe it’s just the times.  

Another sign that while consumers still buying alc bevs, they're shifting from on-premise to off-premise. Data from Pennsy, biggest control state where on-and off-premise liquor sales can be tracked, shows that from mid-Oct thru mid-Nov, "state store sales to individuals were up 7.1% while sales to licensed establishments were down 2%," reports Pittsburgh Trib Review. Most recent fiscal yr sales show total liquor sales up 4.7% with store sales +5.2% vs 2.4% increase on-premise. Consumers "seem to be changing their buying habits for a budget adjustment," one economist told paper. Meanwhile, beer sales up 1% in Sep, most recent data available, +1.5% for 9 mos. "We haven't seen a big decline as some industries have," PA beer wholesalers assn prexy Jay Wiederhold said. "As far as state sales, they're still good."

Express will go on hiatus until next week, unless there's a major development. Enjoy the holidays!

Not sure reason for delay, but Metropolitan Dist, with operations in Toledo and St Henry, OH, recently joined half-dozen others that sued MC over attempted terminations earlier this fall. Metro is Miller and Molson distrib. MillerCoors had picked B&B Beer Dist in Grand Rapids, MI to be consolidator (as it had for Dayton Heidelberg). Metropolitan sued B&B too. Recall the other half-dozen distribs and suppliers have agreed to consolidate cases in same US Dist Ct where 1st case filed.

Courts and legislators still back-and-forthing on direct shipping issue with wholesalers winnin' here, vintners/retailers winnin' there. In latest development, US Dist Ct judge in Mass, after declaring that state's law discriminatory in Nov, just decided proper remedy is to "level up." That means rather than shutting down direct shipments from all small vintners, judge ordered state to "permit wineries of all sizes to apply for licenses" to ship direct to Mass consumers. State AG has 30 days to appeal. Meanwhile, legislators in Mich went in opposite direction. After US Dist Ct ruled in Sep that its laws discriminated against out-of-state retailers, legislature overwhelmingly passed law that shut down all direct shipping by retailers. Per usual, press and retailers howled, but House passed bill 98-4, Senate passed bill 36-2, reports AP.

In all, subpremium brands $$$ sales up 8.6%, gained 0.4 share in food/drug/convenience for 13 weeks thru Nov 30, sez IRI. Gained 0.6 share for 4 weeks. While Keystone Light leading charge for below-premium brands, a number of other smaller lower-priced brands growing sales 20%+ too. Keystone Light $$ sales up 28% for 13 weeks. Gained 0.3 share of $$, tied with Coors Light for biggest share gain for existing brand (Bud Light Lime intro still at 1.5 share of $$ for 13 weeks). Pabst Blue Ribbon also on fire, with $$ sales up 25% for 13 weeks. Tho not included in IRI's subpremium segment, Bud Ice is another lower-priced top 30 brand growing at surprisingly rapid pace. Its $$ sales up 27% for 13 weeks. Avg price paid for Bud Ice down 37 cents, 2% to $16.70. That's about $2.50 a case less than Bud Light. Interestingly, Bud Light Lime selling for about $7 per case more than Bud Light. So there's almost a $10 per case difference between highest priced and lowest priced Bud brand. One other much smaller surprise: Hurricane High Gravity Lager, volume up 22.8%.

Besides excise tax hikes, another highly controversial aspect of NY gov's proposed 09 crisis budget was proposal to allow wine sales in supers. Lined up kinda how you would think. State favors move because it would bring $160 mil into state coffers in next 3 yrs, it estimates. Plus 35 states already allow. Big upstate chain Wegman's said "we love the idea" while liquor stores said it would be "devastating," resulting in many store closings and job losses. Some beer distribs quietly have gotten wine licenses in recent yrs and would be ready for change. Constellation, biggest vintner, with hq in Rochester first told Channel 31 it was "in favor of wine in grocery stores. It says having the product on store shelves will increase awareness of wine." Sounds good, right? Makes sense that biggest vintner would welcome much broader availability of wine in key state. But by next day (probably after angry calls from liquor store assn), Constellation clarified: "Constellation's position has historically been, and remains, one of neutrality regarding the issue." Proposal would have to be passed by legislature and wouldn't go into effect for 6 mos.