USA: Boston Beer Co. reports 24.2% increase in Q3 revenue

Boston Beer Company reported on October 25 its 2018 third-quarter earnings results, which were highlighted by a 24.2 percent increase in net revenue, to $306.9 million.

The company — which makes the Samuel Adams, Angry Orchard, Twisted Tea, and Truly Spiked & Sparkling products — credited the revenue growth to a 23.5 percent increase in shipments during the quarter, which ended September 29.

The company shipped about 1.3 million barrels of product, it said via a press release. Through the first 39 weeks of the year, Boston Beer has shipped about 3.3 million barrels of beer, hard cider and flavored malt beverages — a 16 percent increase from 2017.

Boston Beer’s year-to-date depletions are up 13 percent, driven primarily by growth within its non-beer portfolio.

Meanwhile, Q3 depletions increased 18 percent versus 2017. The company credited its growth during the quarter to the continued success of its Truly, Twisted Tea and Angry Orchard brands, while sales of its Samuel Adams offerings continued to decline.

“We believe that the acceleration in our depletions growth is attributable to our key innovations, quality and strong brands, as well as sales execution and support from our distributors,” Boston Beer founder Jim Koch said, via a press release.

To help stoke growth for the Samuel Adams brand, the company introduced a new advertising campaign during the third quarter, which is aimed at communicating its “artisanal care in the brewing of Samuel Adams Boston Lager.”

“We plan to invest in this campaign in the coming months, with the goal of improving trends and returning Samuel Adams back to growth,” Koch added.

The company is now anticipating finishing 2018 with depletions growth between 12 and 15 percent, an increase from previous estimates of between 7 and 12 percent.

Boston Beer’s gross margin declined in Q3 to 52.1 percent, compared to 53.2 percent in the comparable 13-week period last year. The company’s full-year gross margin is down to 51.3 percent, compared to 52.1 percent in 2017.

Shares of SAM stock declined more than 3 percent at the close of trading on October 25.