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Dec 28, 2024
Boston Beer Q4 2024 Earnings Report
Boston Beer reported flat depletions and a 0.5% decrease in shipments, with net revenue increasing by 2.2% and gross margin improving by 230 basis points year over year.
Key Takeaways
The Boston Beer Company reported mixed financial results for the fourth quarter ended December 28, 2024. While depletions were flat and shipments decreased slightly, net revenue increased by 2.2% and gross margin saw a significant improvement. However, the company reported a GAAP diluted loss per share, primarily due to a contract settlement expense.
Depletions were flat and shipments decreased 0.5% in the fourth quarter.
Net revenue increased 2.2% to $402.3 million.
Gross margin improved by 230 basis points year over year to 39.9%.
GAAP diluted loss per share was $3.38, including a $1.70 per share contract settlement expense.
Boston Beer
Boston Beer
Forward Guidance
For the full year 2025, Boston Beer projects depletions and shipments to be down low single digit to up low single digit, with net revenue increasing by 1% to 2%. GAAP EPS is expected to be between $8.00 and $10.50.
Positive Outlook
- Advertising investment will be stepped up in 2025 to strengthen brands and drive long-term sustainable growth.
- Strong balance sheet and cash flow generation allow for increased advertising investment and continued share repurchases.
- First half 2025 shipments are expected to be at the high end of the full year guidance range due to timing of estimated demand and wholesaler inventory levels for certain brands.
- The Company expects its December 28, 2024 cash balance of $211.8 million, together with projected future operating cash flows and unused line of credit, will be sufficient to fund future cash requirements.
- The benefit of lapping CEO transition costs incurred in 2024 is expected to offset an increase in estimated incentive compensation at target for 2025.
Challenges Ahead
- Actual 2025 results could vary significantly from current projections due to changes in volume projections, supply chain performance, and inflationary impacts.
- Projections do not include any impact related to potential tariffs.
- The Company's business is seasonal, with the first and fourth quarters being lower volume quarters and the fourth quarter typically having the lowest absolute gross margin rate.
- During full year 2025, shortfall fees are estimated to negatively impact gross margin by 60 to 80 basis points.
- Non-cash expense of third-party production pre-payments will negatively impact gross margins by 40 to 60 basis points in 2025.