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Boston Beer Sales Down 5% In First Quarter As Sam Adams, Angry Orchard Lose Steam

April 22, 2016

Boston Beer Co. continues to feel the heat from rising competition in the craft beer category that it helped pioneer, posting single-digit sales and volume declines in its first quarter, ended April 15.

Net revenue was down 5% to $188.9 million, as shipments dropped 6% to 830,000 barrels compared with the same period last year. The lackluster first-quarter results led to a significant drop in Boston Beer’s share price in after-hours trading, as the company revised its 2016 depletions forecast from a mid-single-digit increase to a range of -4% to +2%. The company’s share price is currently down more than 40% from its peak in early 2015.

While acknowledging that craft competition and increasingly fickle consumer tastes have taken a toll, Boston Beer founder and chairman Jim Koch said the group would combat the tough conditions long-term through ongoing innovation and brand investment. “We believe that we are well positioned to meet the longer term challenges of this competitive environment, through the quality of our beers, our innovation capability and our sales execution strength, coupled with our strong financial position that enables us to invest in growing our brands,” he said.

Boston Beer’s core Samuel Adams franchise continued to lose ground in the first quarter, although the company touted solid starts for several of its newer Samuel Adams products, including Samuel Adams Nitro White Ale, Nitro IPA, Nitro Coffee Stout and Rebel Grapefruit IPA.

Meanwhile, Angry Orchard’s depletions also fell, with Boston Beer president and CEO Martin Roper citing a recent cider category slowdown, as well as an influx of hard sodas and other alternative offerings, as the primary causes. Despite the challenging climate, however, Boston Beer’s Twisted Tea and Coney Island range—including its own hard soda offering, Coney Island Hard Root Beer—both posted gains for the quarter.

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