USA: Craft Brew Alliance reports 9% increase in first quarter shipments

Craft Brew Alliance (CBA) on May 9 reported its first quarter 2018 earnings, which were highlighted by a 9 percent increase in shipments, to 167,000 barrels, on soft comps from a year ago, Brewbound reports.

In a press release, the company – which makes and markets the Kona, Widmer Brothers, Redhook, Omission, and Square Mile Cider brands – said net sales increased 7 percent, to $47.5 million, while gross profit increased 19 percent, to $15.1 million, during the quarter.

Once again, the company’s Kona offerings contributed to the positive first quarter shipment and sales figures as depletions for that brand grew 3 percent while overall CBA depletions declined 4 percent.

“CBA’s solid first quarter results underscore the improved health of our company by combining sustained strength for Kona, anchored by a 22 percent increase in flagship Big Wave, with exceptional company-wide cost management and efficiency gains,” CEO Andy Thomas said via the release. “We are now in a stronger position than ever to increase investments behind our Kona-plus strategy as we explore new avenues for growth in this transformed and ever-changing competitive marketplace.”

Overall Kona shipments grew about 20 percent, to 99,000 barrels, while shipments of Widmer Brothers and Redhook products declined 16.2 percent (to 23,300 barrels) and 10.1 percent (to 18,600 barrels), respectively. Omission shipments, meanwhile, grew 12 percent during the quarter, to 10,300 barrels.

CBA credited its partnership with Anheuser-Busch InBev, which owns 31.4 percent of the Portland, Oregon-based company, for helping deliver a strong first quarter performance.

“We continued to leverage our enhanced agreements with Anheuser-Busch (“AB”), with CBA brands participating in key wholesaler focus programs to support the upcoming summer selling season as we realized ongoing cost efficiencies through producing and shipping beer from AB’s Fort Collins brewery,” the company wrote.

Meanwhile, selling, general and administrative expenses decreased 5 percent, to $14.7 million during the quarter, which the company attributed to the sale of its Redhook brewing facility in Woodinville, Washington, and the “timing of sales and marketing initiatives.”

Nonetheless, CBA expects SG&A expenses to range between $59 and $61 million on the year as it “continues to reinvest costs savings” into its various brands as well as “consumer and trade marketing programming.”

“We’re seeing the building blocks of CBA’s financials come together in a way that truly reinforces the strengthening of our company as an outcome of the team’s hard work,” CFO Joe Vanderstelt added in the release. “These results could not have come together at a more important time in our business as we look for opportunities to grow the topline by strategically investing in our brands in an otherwise challenging segment.”

In 2018, the company said it expects both shipments and depletions to range between a decline of 2 percent and an increase of 3 percent.

10 May, 2018