Profits up 25% driven by price increase and 8% rise in depletions
Boston Beer Co reported a 25 percent jump in second-quarter profit as increased shipment volume and higher beer prices helped offset rising costs of ingredients used and packaging material.
Depletions were up 8 percent for the quarter and 10 percent year to date.
Jim Koch, Chairman and Founder of the Company, commented, “We achieved 8% depletions growth in the second quarter compared to 12% depletions growth in the first quarter. Our depletions growth slowed slightly in the first half of the summer, but we still appear to be growing our share within the craft beer category. We are encouraged by our position and remain positive about the future of craft beer, even as the craft category has raised pricing in the face of significant cost pressures. “
Net income was $8.5 million, or 60 cents a share, for the period ended June 28, compared with $6.8 million, or 46 cents a share, a year earlier. The company, which in April announced a recall of select bottles of Samuel Adams beer after safety checks at its Cincinnati brewery raised concerns that bottles may contain small grains or bits of glass, said the latest second-quarter results include a recall-related charge of 19 cents a share.
Net revenue rose 26 percent to $117.4 million. Shipment volume rose 19 percent, including the impact of replenishment shipments for the product recall.
In March the brewer said it planned to increase prices by 5 percent to counter rising costs for barley, hops and packaging material.