First quarter sales up, profits down
Pyramid Breweries announced that it has incurred an increase in its losses for the first quarter despite a 25% rise in sales.
The company reported a 25.6% overall growth in sales, which includes the acquisition of Portland Brewing Company assets in July of last year and strong sales growth in both beer and soda products in its key West Coast markets. However, operating costs remained high due to underutilization of brewing capacity and freight surcharges.
Net loss for the first quarter of 2005 was $1,131,000, compared to a net loss of $996,000 during the same quarter of the prior year.
“The improving growth in our flagship Pyramid Brand Family, which we saw beginning in the fourth quarter of 2004, continued to gain momentum during the first quarter of 2005. Despite a weak, yet highly competitive brewing industry environment, we are seeing strong growth in all markets with our award winning Pyramid-branded beers,” quoted John Lennon, CEO.
Lennon further stated, “During the first quarter of 2005, the company began to consolidate its brewing operations by shifting the brewing of branded products from Seattle to the Portland brewing facility. We incurred one time costs during the quarter in connection with this initiative. In addition, we have added sales resources in the Southwest in order to build new distribution and augment sales velocity. We have also invested in marketing programs, which will be implemented later in the year. Overall, we are encouraged by the improving trends in sales and operations during the quarter and we anticipate deriving favorable benefits from these activities during the balance of 2005, including improved sales results and a tighter cost structure.”