From Craft Brew Alliance:
PORTLAND, OR - 12 Mar 2013/mbb/ – Craft Brew Alliance, Inc. , an independent craft brewing company, reported final 2012 financial results and confirmed 2013 guidance. CBA’s successful strategic focus on building a national portfolio strategy over the last three years has positioned the Company to expect strong sales and profit growth in 2013 and take advantage of the dynamic craft segment to achieve long-term value for its shareholders.
Highlights of 2012 results include:
- A strong close to 2012 highlighted by 10% growth in depletions for the fourth quarter
- Full year top- and bottom-line results in line with guidance provided during the last quarterly update:
- Sales growth of 13%, reflecting the continued strength of the Kona, Redhook and Omission brands, as well as continued repositioning of the Widmer Brothers brand
- Depletion growth of 6%
- Shipment growth of nearly 8%, reflecting new initiatives such as the launch of the Omission brand and international export
- Gross margin rate of 29.6%, a reduction of 70 basis points from 2011, reflecting higher brewery variable costs on a per barrel basis, partially offset by improved fixed cost coverage and a shift in mix to our higher-end beers
- Selling, general and administrative expense (“SG&A”) of $44.9 million, an increase of $5.1 million from 2011, reflecting continued investments in brand development and sales capabilities
- Diluted earnings per share (“EPS”) of $0.13 versus 2011 EPS of $0.51; 2011 EPS included the one-time gain on sale of our equity interest in Fulton Street Brewery of $0.34 per share
- Capital expenditures of approximately $9.1 million, reflecting continued investments in capacity, efficiency and quality initiatives
“As a follow-up to our release in late January, we want to confirm that we expect meaningful growth in both revenue and earnings resulting from the overall strength of our portfolio strategy, operating expense leverage and SG&A leverage in 2013,” said Terry Michaelson, CBA’s CEO. “As we enter the next phase in the development of our portfolio strategy, we are focusing on leveraging our recent investments, brand momentum and breadth, and geographic expansion, to deliver improved sales and profit growth. This is consistent with our phased approach to strengthening our model to ultimately deliver long-term value growth.”
Components of anticipated 2013 results and developments
“We continue to believe our brand strategy is the most promising it has been in CBA’s history. We expect strong growth tempered by unprecedented competition,” said Terry Michaelson. Expectations for 2013 include (i) confidence in the continued growth in sales of Kona, Redhook and Omission, and clear positioning of Widmer Brothers offerings; (ii) expansion into new geographic markets for Kona and international expansion for all brand families; (iii) updates to packaging across all brand families, as well as introduction of unique can and bottle offerings; (iv) refined messaging on Omission beers, promoting the beer as specially crafted to remove gluten; (v) exploration of introducing additional or new brands to the CBA portfolio; and (vi) continued development of cross brand packages bringing the power of our portfolio to consumers in real and compelling ways.
“While we are providing full-year guidance for 2013, I want to emphasize that we anticipate significant differences in 2013 quarterly performance as compared to 2012,” said Mark Moreland, CBA’s CFO. “This is due to both normal changes to programs and new product timing, as well as uneven 2012 quarterly performance as a result of the implementation of new supply chain processes and systems that will drive improved supply chain control during 2013. Specifically, we expect relatively weak shipments in the first quarter of 2013 when compared to the volume generated by the 15% growth in shipments in the first quarter of 2012.”
We are confirming previously provided anticipated full year 2013 results, as follows:
- Depletion growth estimate of 7% to 11%, reflecting the continued strength of the Kona, Redhook and Omission brands and further stabilization of the Widmer Brothers brand
- Average price increases of approximately 1% to 2%
- Contract brewing revenue for 2013 will be approximately half of the 2012 level as a result of the mutual decision to unwind the Goose Island contract brewing arrangement
- Gross margin rate of 28.5% to 30.5%, reflecting higher brewery variable costs on a per barrel basis, partially offset by better fixed cost coverage
- SG&A expense ranging from $47 million to $49 million, reflecting leverage from the foundation built by more aggressive spending in prior years
- Capital expenditures of approximately $11 million to $13 million, continuing our investments in capacity and efficiency improvements, quality initiatives and restaurant and retail
.
0 comments (click to read or post):
Post a Comment
Please leave a comment...I do moderate each comment so it may not appear immediately...and please be nice! You can also comment using Disqus (below) or even comment directly on Facebook (bottom).