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Overall growth of the cider category in the US is slowing down but the rise of craft producers could spark renewed opportunity, according to the head of Boston Beer Co.

Angry Orchard could benefit from the growth of craft cider, according to Boston Beer Co

Angry Orchard could benefit from the growth of craft cider, according to Boston Beer Co

In the company’s half-year results, released late last week, president & CEO Martin Roper noted that its Angry Orchard cider brand was one of the main players driving depletions growth in the second quarter, offsetting the "declines in some of our Samuel Adams styles". But, speaking to analysts following the results announcement, Roper said the deceleration of growth in the cider category had been "pretty dramatic".

"This time last year," Roper said, "the category growth was 70%." During the last 13-week period, however, he estimated that growth was "down maybe in the teens".

"This has been a little bit of surprise to us. We've obviously watched and we're very happy that we've maintained share and we've maintained growth, and we're studying it, trying to understand."

The category remains "viable", Roper added, with "a lot of room to grow".

One area of growth is craft cider, with Roper noting "a start-up of small, local cideries on a pretty accelerated scale, certainly much faster than it took for that to be seen in craft [beer] 20, 30 years ago". Growth in the craft cider category over the last 12 months is "leading to innovation in high-end ciders and different tastes," he added. "So, we have that as opportunity for our cider brand, too".

In a note following the call, analyst Edward Mundy from Nomura said that, over the medium term, he sees the overall cider segment in the US growing "from 1% of beer to 2% to 3%".

For Angry Orchard, Mundy believes that on-going distribution opportunities in the on-trade "could provide a further uplift of 50% from accessing new accounts", noting also that the company is launching some drier variants of Angry Orchard as well as a lighter, low-calorie cider brand called Lazy River.

Boston Beer also said last week that its planned opening of an Angry Orchard cidery is expected to take place in Q4. Last month, the companyt shared plans to launch Angry Orchard in the UK.


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