CANADA: Big Rock Brewery's Q1 sales slip
- Q1 net losses of CAD26,000 (US$26,900), versus losses of CAD12.99m in Q1 2010
- Operating losses of CAD7,000, profits of CAD1.2m last year
- Net sales fall by 16.5% to CAD8.8m
- Canada's beer industry struggles to match boost from Winter Olympics in Q1 2010
Big Rock Brewery's sales suffer in Q1
Big Rock Brewery has become the latest Canadian brewer to report a fall in sales in the first quarter of 2011, hampering its return to profits.
The group's net sales fell by 16.5% for the three months to the end of March, with volumes down by 14.6% to 42m hectolitres. Canada's beer industry has suffered in the quarter, due to tough economic conditions and brewers' inability to match sales boosted by Canada's hosting of the Winter Olympics in 2010.
During the first thee months of 2011, Big Rock reported its third highest volume sales for a fiscal first quarter. But, it still saw sales fall more sharply than some of its larger competitors. Molson Coors and Anheuser-Busch InBev's Labatt reported volumes down by 6% and 7% respectively for the three-month period.
Big Rock said that it saw some the biggest declines in value beers and 'lime light' beers. "Management believes the decline in value-priced brands was the result of the multi-national breweries’ continued focus and aggressive pricing strategies in the value-priced category," it said.
In the quarter, the group's cost of sales per hectolitre also increased by 15%, which suppressed operating profits. The firm reported operating losses of CAD7,000, versus profits of CAD1.2m a year earlier.
However, Big Rock significantly cut net losses, to CAD26,000 from CAD12.99m. Last year's first quarter was marked by a CAD13m charge for the group in relation to the revaluation of its trust units.
For the company statement, click here.
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