US: Craft Brew Alliance warns of "unprecedented competition" as FY profits dip
- FY net profits slide by 74% to US$2.5m
- Net sales rise by 13% to $169.3m
- Operating profits drop 5.7% to $5.1m
- Kona brand to be rolled-out to new markets in 2013
CBA says 2013 will be "tempered by unprecedented competition" in the craft beer sector
Craft Brew Alliance (CBA) has reported a marked drop in full-year profits and warned that its performance this year will be weakened by “unprecedented competition” in the sub-category.
Net profits in the 12 months to the end of December plunged by 74% to US$2.5m, the Pacifice north-west brewing alliance said late yesterday (12 March). Sales in the period were up by 13% to $169.3m.
Operating profits in the 12 months fell by 5.7% to $5.1m.
The slide is partly due to a difficult 2011 comparative, which was boosted by the sale of its 42% stake in Fulton Street Brewery, also known as Goose Island, to Anheuser-Busch InBev. Last year also saw around $9.1m of capital expenditure on capacity, efficiency and “quality initiatives”, CBA said.
Fourth-quarter net profits, meanwhile, rose by 32% to $0.3m, as sales increased by 20% to 41.9m. Operating profits in the three months leapt by 82% to $0.9m.
Looking ahead, Terry Michaelson, CBA's CEO, said the company expects “meaningful growth” from sales and profits in 2013 helped by its “portfolio strategy, operating expense leverage and SG&A leverage”. This will include expansion into new markets for its Kona brand and international expansion for “all brand families”.
He added: “We expect strong growth tempered by unprecedented competition.”
The company also said its contract brewing income for 2013 will be around half of 2012's due to a "mutual decision to unwind the Goose Island contract brewing arrangement" with Anheuser-Busch InBev.
To read CBA's full statement, click here
MillerCoors' plans to launch a new, high-strength "golden" lager may not be surprising on one level, but the wider trend is puzzling....
Anheuser-Busch InBev (A-B InBev) is facing challenges in the mature US beer category by focusing on premium and craft beer. As the US Justice Department precluded A-B InBev from controlling the lucrat...
- Comment - Diageo Steps Up Defence of Haig Club
- Focus - Diageo's H1 Results by Region, Brand
- just the Preview - Diageo Q2 & H1
- just the Facts - Top 20 US Beers by Value, Volume
- Comment - Spirits - Where Next for Scotch Whisky?
- Belvedere vodka tie-up over new James Bond film
- Diageo speaks out over supplier contract changes
- Brown-Forman appoints Jack Daniel's president
- Diageo inks UK distribution deals
- ASA rejects Haig Club ad complaints
- Global RTD/RTS insights - market forecasts, product innovation and consumer trends research
- Diageo plc (DGE) - Financial and Strategic SWOT Analysis Review
- Global vodka insights - market forecasts, product innovation and consumer trends research
- Edrington Group in Spirits (World)
- Global Consumer Trends and Key Consumer Targets in Alcoholic Beverages