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Mar 26, 2022
Boston Beer Q1 2022 Earnings Report
Reported a decrease in net revenue and gross margins.
Key Takeaways
Boston Beer reported a decrease in first quarter depletions by 7% and shipments decreased by 25.1%. Net revenue decreased by 21.1% to $430.1 million, and the company experienced a net loss of $2.0 million, a significant decrease from the previous year's net income of $65.6 million.
First quarter depletions decreased 7% and first quarter shipments decreased 25.1% compared to the quarter ended March 27, 2021
First quarter net revenue of $430.1 million decreased 21.1% compared to the net revenue realized in the first quarter of 2021
First quarter gross margin of 40.2% was 5.6 percentage points below the 2021 first quarter margin of 45.8%
First quarter net loss of $2.0 million or $0.16 per diluted share, decreased from net income of $65.6 million or $5.26 per diluted share in the first quarter of 2021.
Boston Beer
Boston Beer
Forward Guidance
The Company currently projects full-year 2022 Non-GAAP earnings per diluted share of between $11.00 and $16.00.
Positive Outlook
- Full-year depletion and shipment growth continues to be estimated at between 4% and 10%.
- National price increases of between 3% and 5%.
- Gross margin of between 45% and 48%.
- Increased investments in advertising, promotional and selling expenses of between $0 and $20 million.
- Non-GAAP effective tax rate of approximately 26%, excluding the impact of ASU 2016-09.
Challenges Ahead
- This projection excludes the impact of ASU 2016-09 and is highly sensitive to changes in volume projections particularly related to the hard seltzer category and supply chain performance as well as inflationary impacts that have accelerated since we provided our last guidance.
- The Company’s actual 2022 earnings per share could vary significantly from the current projection.
- In the first quarter of 2022 total depletions declined 7% compared to the first quarter of 2021 and increased 38% compared to the first quarter of 2020.
- Estimated capital spending of between $140 million and $190 million.
- The Company is unable to reconcile the projection for its Non-GAAP effective tax rate and earnings per diluted share, excluding the impact of ASU 2016-09, because the Company is unable to predict the impact of future events outside the Company’s control, including the timing and value realized upon exercise of stock options versus the fair value of those options when granted.