Boston Beer Company reported second-quarter depletions (sales-to-retailers) and shipments (sales-to-wholesalers) growth of 17 percent, according to financial results issued after the end of trading today.
Through the first 26 weeks of 2019, Boston Beer posted depletions (+15 percent) and shipments (+23 percent) growth due to its Truly Hard Seltzer and Twisted Tea brands. The company has shipped about 2.5 million barrels of product through the end of June.
Boston Beer — which also makes the Samuel Adams and Angry Orchard brands — reported Q2 net revenue growth of 16.6 percent, to $318.4 million. Through June 29, Boston Beer’s revenue is up 23 percent, to $570.1 million.
In a press release, Boston Beer founder Jim Koch noted that the company has achieved five consecutive quarters of double-digit depletions growth. He also noted “challenges across the industry, including a general softening of the part of the craft beer category that goes through the three-tier distribution system and retail shelves that offer an overwhelming number of options to drinkers.”
However, Koch said the company remains “positive about the future of craft beer and are happy that our diversified brand portfolio continues to fuel double-digit growth.”
“I am pleased that our overall business has shown great momentum and depletion improvements during the first half of the year,” Boston Beer CEO Dave Burwick said in the release.
Burwick added that Truly will launch on draft in the third quarter, while continuing to expand distribution.
“In addition, we are launching a new, high-profile ad campaign for Truly featuring noted comedian Keegan-Michael Key as we believe we can further improve our position as a leader in hard seltzer by building a meaningful and relevant brand,” Burwick said.
According to the release, Dogfish Head Craft Brewery, which merged with Boston Beer in May as part of a $300 million transaction, will be consolidated into Boston Beer’s financial results starting July 3 (the closing date of the deal). The company anticipates that Dogfish Head will add between 3 and 4 percent in annual shipments and depletions growth to Boston Beer, as well as between $50 million and $60 million in net revenue.
“This combination is the right fit as both Boston Beer and Dogfish Head have a passion for brewing and innovation,” Koch said. “I am very happy that Sam Calagione of Dogfish Head will be joining our management team at Boston Beer. He is a tremendous friend, innovator and brewer, and we have a bright future together with Sam and his off-centered Dogfish team.”
Boston Beer is now estimating shipments and depletions to grow between 17 and 22 percent for the full year. Those estimates now include volume from Dogfish Head.