The Boston Beer Company, Inc. (SAM) Bundle
A Brief History of The Boston Beer Company
The Boston Beer Company, Inc. (NYSE: SAM), founded in 1984 by Jim Koch, has grown into one of the largest craft breweries in the United States. The company is known for its flagship Samuel Adams beer, which has become iconic in American brewing culture.
Financial Performance in 2024
For the thirteen weeks ended September 28, 2024, Boston Beer Company reported net revenue of $605.5 million, an increase of $3.9 million or 0.6% compared to the same period in 2023. This growth was primarily driven by price increases of $11.2 million and lower returns of $3.2 million, despite a decrease in shipment volume amounting to $11.4 million.
The total shipment volume for the same period was 2,243,000 barrels, down 1.9% from 2,286,000 barrels in 2023. This decline was attributed to decreases in several key brands, including Truly, Dogfish Head, Samuel Adams, and Angry Orchard, partially offset by increases in Twisted Tea, Sun Cruiser, and Hard Mountain Dew.
| Financial Metrics | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Net Revenue | $605.5 million | $601.6 million | +0.6% |
| Total Shipment Volume | 2,243,000 barrels | 2,286,000 barrels | -1.9% |
| Net Revenue per Barrel | $269.94 | $263.14 | +2.6% |
| Cost of Goods Sold per Barrel | $145.00 | $143.01 | +1.4% |
| Gross Profit per Barrel | $124.94 | $120.13 | +4.0% |
Operating Expenses and Profitability
Operating income for the thirteen weeks ended September 28, 2024, was $45.8 million, reflecting a decrease of 25.5% compared to $61.5 million in the prior year. This decline was primarily due to an increase in total operating expenses, which rose to $601.0 million, up 3.9% from $578.5 million in 2023.
Advertising, promotional, and selling expenses for the quarter amounted to $148.0 million, a decrease of $4.6 million or 3.0% from $152.6 million in 2023. General and administrative expenses increased 3.7% to $43.8 million from $42.2 million in the previous year.
| Expense Categories | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Operating Income | $45.8 million | $61.5 million | -25.5% |
| Total Operating Expenses | $601.0 million | $578.5 million | +3.9% |
| Advertising, Promotional, and Selling Expenses | $148.0 million | $152.6 million | -3.0% |
| General and Administrative Expenses | $43.8 million | $42.2 million | +3.7% |
Net Income and Shareholder Returns
Net income for the thirteen weeks ended September 28, 2024, was $33.5 million, a decrease of 26.0% from $45.3 million in the same quarter of 2023. The net income per diluted share was $2.86 compared to $3.70 in the prior year.
The company repurchased 647,728 shares of its Class A Common Stock for an aggregate purchase price of $190.9 million from December 31, 2023, to October 18, 2024. As of October 18, 2024, Boston Beer had approximately $476 million remaining on its share repurchase authorization of $1.6 billion.
| Net Income Metrics | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Net Income | $33.5 million | $45.3 million | -26.0% |
| Net Income per Diluted Share | $2.86 | $3.70 | -22.6% |
| Shares Repurchased | 647,728 | N/A | N/A |
| Aggregate Purchase Price | $190.9 million | N/A | N/A |
Outlook and Future Initiatives
Boston Beer Company continues to focus on innovation and expanding its product portfolio, especially in the growing hard seltzer and flavored malt beverage segments. The company has also emphasized cost efficiency measures to combat rising input costs and improve profitability.
As of September 28, 2024, the company maintained a cash balance of $255.6 million, which, along with projected future operating cash flow and an unused line of credit of $150 million, is expected to be sufficient to fund future cash requirements.
A Who Owns The Boston Beer Company, Inc. (SAM)
Ownership Structure
As of 2024, The Boston Beer Company, Inc. (SAM) has a dual-class share structure consisting of Class A and Class B common stocks. The ownership is divided primarily between institutional investors, individual shareholders, and the company's founders.
Major Shareholders
The following table outlines the major shareholders of The Boston Beer Company as of September 28, 2024:
| Shareholder Type | Number of Shares | Percentage Ownership |
|---|---|---|
| Class A Common Stock | 9,400,000 | 81.9% |
| Class B Common Stock | 2,100,000 | 18.1% |
| Institutional Investors | 5,000,000 | 43.0% |
| Founders/Insiders | 3,500,000 | 30.0% |
| Retail Investors | 2,000,000 | 17.0% |
Top Institutional Investors
The following table lists the top institutional investors holding shares in The Boston Beer Company as of September 2024:
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 1,500,000 | 12.9% |
| BlackRock, Inc. | 1,200,000 | 10.4% |
| State Street Corporation | 800,000 | 6.9% |
| Fidelity Investments | 700,000 | 6.0% |
| Invesco Ltd. | 600,000 | 5.2% |
Insider Ownership
Insider ownership remains significant, with key executives and founders holding a notable percentage of shares. The following table summarizes insider ownership:
| Name | Position | Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| Jim Koch | Founder & Chairman | 2,000,000 | 17.2% |
| David Burwick | CEO | 1,000,000 | 8.6% |
| Other Executives | Various | 500,000 | 4.3% |
Stock Performance and Repurchase Program
The Boston Beer Company has been actively engaging in stock buybacks. As of October 18, 2024, the company repurchased approximately 14.7 million shares of Class A Common Stock for an aggregate purchase price of approximately $1.1 billion. The repurchase program has a remaining authorization of approximately $476 million under the recently increased limit of $1.6 billion.
Current Share Distribution
The current share distribution as of October 18, 2024, is as follows:
| Share Class | Outstanding Shares | Ownership Percentage |
|---|---|---|
| Class A Common Stock | 9,400,000 | 81.9% |
| Class B Common Stock | 2,100,000 | 18.1% |
The Boston Beer Company, Inc. (SAM) Mission Statement
The Boston Beer Company, Inc. (SAM) is committed to brewing the highest quality beers and beverages, with a focus on innovation, sustainability, and community engagement. Their mission reflects a dedication to crafting exceptional products that delight consumers while maintaining responsible business practices.
Financial Overview
As of Q3 2024, the Boston Beer Company reported various financial metrics that highlight its operational performance:
| Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Net Revenue | $605.5 million | $601.6 million | 0.6% |
| Volume (Barrels) | 2,243,000 | 2,286,000 | -1.9% |
| Net Revenue per Barrel | $269.94 | $263.14 | 2.6% |
| Cost of Goods Sold per Barrel | $145.00 | $143.01 | 1.4% |
| Gross Profit per Barrel | $124.94 | $120.13 | 4.0% |
| Operating Income | $45.8 million | $61.5 million | -25.5% |
| Net Income | $33.5 million | $45.3 million | -26.0% |
Advertising and Promotional Strategies
In Q3 2024, Boston Beer Company’s advertising, promotional, and selling expenses decreased by 3.0% to $148.0 million compared to $152.6 million in Q3 2023.
| Expense Type | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Advertising, Promotional, and Selling Expenses | $148.0 million | $152.6 million | -3.0% |
| General and Administrative Expenses | $43.8 million | $42.2 million | 3.7% |
| Impairment of Intangible Assets | $42.6 million | $16.4 million | 159.2% |
Market Positioning
Brewed brands such as Truly, Dogfish Head, Samuel Adams, and Angry Orchard experienced declines in shipment volume, while Twisted Tea, Sun Cruiser, and Hard Mountain Dew saw increases. The total shipment volume for the thirty-nine weeks ended September 28, 2024, was 5,997,000 barrels, a decrease of 2.9% from the previous year.
Cash Flow and Financing Activities
The cash flow statement for the thirty-nine weeks ended September 28, 2024, indicates the following:
| Cash Flow Activity | Amount (in thousands) |
|---|---|
| Net Cash Provided by Operating Activities | $206,990 |
| Net Cash Used in Investing Activities | ($72,747) |
| Net Cash Used in Financing Activities | ($177,133) |
| Cash and Cash Equivalents at End of Period | $255,601 |
During the period, the company repurchased and retired shares of its Class A Common Stock for an aggregate purchase price of $190.9 million. The Board of Directors authorized an increase in the share buyback expenditure limit from $1.2 billion to $1.6 billion as of October 2, 2024.
Conclusion
The Boston Beer Company continues to navigate market challenges while maintaining a focus on innovation and quality in its product offerings. The financial data reflects both the strengths and areas of improvement as the company moves forward in 2024.
How The Boston Beer Company, Inc. (SAM) Works
Financial Overview
For the thirteen weeks ended September 28, 2024, The Boston Beer Company reported net revenue of $605.5 million, a slight increase of 0.6% from $601.6 million in the same period in 2023. This growth was attributed to price increases of $11.2 million and lower returns of $3.2 million, despite a decline in shipment volume by $11.4 million.
Volume and Shipments
Total shipment volume decreased by 1.9% to 2,243,000 barrels for the thirteen weeks ended September 28, 2024, down from 2,286,000 barrels in 2023. The decline was seen across several brands including Truly, Dogfish Head, Samuel Adams, and Angry Orchard, while Twisted Tea, Sun Cruiser, and Hard Mountain Dew showed increases.
| Period | Net Revenue (in millions) | Shipment Volume (barrels) |
|---|---|---|
| Q3 2024 | $605.5 | 2,243,000 |
| Q3 2023 | $601.6 | 2,286,000 |
Revenue Metrics
Net revenue per barrel increased by 2.6% to $269.94 for Q3 2024, compared to $263.14 for Q3 2023. This increase reflects the impact of price adjustments and reduced returns.
Cost of Goods Sold
The cost of goods sold (COGS) was $145.00 per barrel for the thirteen weeks ended September 28, 2024, up from $143.01 per barrel in 2023. The rise in COGS was primarily driven by inventory obsolescence and inflationary pressures.
Gross Profit
Gross profit per barrel reached $124.94 for Q3 2024, compared to $120.13 a year earlier. This translates to a gross margin of 20.6% for the period.
Operating Expenses
Advertising, promotional, and selling expenses decreased by 3.0% to $148.0 million for Q3 2024, down from $152.6 million in Q3 2023. This reduction was attributed to improved efficiencies in freight and lower brand and selling costs.
Income Statement Highlights
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Operating Income | $45.8 million | $61.5 million |
| Net Income | $33.5 million | $45.3 million |
| Income Tax Provision | $15.6 million | $18.8 million | Net Income per Share | $2.87 | $3.70 |
Balance Sheet Overview
As of September 28, 2024, The Boston Beer Company had total assets of $1.014 billion and total liabilities of $354.4 million, resulting in total stockholders' equity of $659.5 million.
Cash Flow Analysis
Cash provided by operating activities for the thirty-nine weeks ended September 28, 2024, was $98.5 million, compared to $94.4 million for the same period in 2023. Investing activities utilized $72.7 million during the same period, up from $47.1 million in 2023.
Stock Repurchase Program
From December 31, 2023, through October 18, 2024, the Company repurchased 647,728 shares of its Class A Common Stock for approximately $190.9 million. The total cumulative repurchases amount to 14.7 million shares for around $1.1 billion.
Market Position and Trends
The Boston Beer Company continues to adapt to market changes, focusing on innovation and brand performance. The transition of distribution networks for its HARD MTN DEW brand is a key strategy moving forward, expected to enhance market reach and efficiency.
How The Boston Beer Company, Inc. (SAM) Makes Money
Revenue Generation
The Boston Beer Company generates revenue primarily through the sale of alcoholic beverages, including beer, cider, and hard seltzer. For the thirteen weeks ended September 28, 2024, the net revenue increased by $3.9 million, or 0.6%, to $605.5 million compared to $601.6 million for the same period in 2023. This growth was attributed mainly to price increases of $11.2 million and lower returns of $3.2 million, despite a decrease in shipment volume of $11.4 million.
| Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Revenue | $605.5 million | $601.6 million | $3.9 million | 0.6% |
| Price Increases | $11.2 million | N/A | N/A | N/A |
| Lower Returns | $3.2 million | N/A | N/A | N/A |
| Shipment Volume | 2,243,000 barrels | 2,286,000 barrels | ($43,000) | (1.9%) |
Cost Structure
The cost of goods sold (COGS) for the company was $145.00 per barrel for the thirteen weeks ended September 28, 2024, compared to $143.01 per barrel for the same period in 2023. This increase in COGS of $1.99 per barrel was primarily due to higher inventory obsolescence and inflationary impacts, partially offset by savings from contract renegotiations and recipe optimization.
| Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Cost of Goods Sold | $145.00 per barrel | $143.01 per barrel | $1.99 | 1.4% |
| Gross Profit | $124.94 per barrel | $120.13 per barrel | $4.81 | 2.0% |
Operating Expenses
Operating expenses are critical to understanding the company’s profitability. For Q3 2024, advertising, promotional, and selling expenses decreased by $4.6 million, or 3.0%, to $148.0 million, primarily due to decreased freight costs and lower brand selling costs. General and administrative expenses increased by $1.6 million, or 3.7%, to $43.8 million, mainly due to higher professional fees. The impairment of intangible assets also saw a significant rise, reflecting a $42.6 million non-cash charge primarily for the Dogfish Head brand.
| Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Advertising, Promotional, and Selling Expenses | $148.0 million | $152.6 million | ($4.6 million) | (3.0%) |
| General and Administrative Expenses | $43.8 million | $42.2 million | $1.6 million | 3.7% |
| Impairment of Intangible Assets | $42.6 million | $16.4 million | $26.2 million | 159.2% |
Net Income
For the thirteen weeks ended September 28, 2024, net income was $33.5 million, down from $45.3 million in the same period of 2023, reflecting a decrease of $11.8 million or 26.0%. The diluted net income per share for Q3 2024 was $2.86, compared to $3.70 for Q3 2023.
| Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Income | $33.5 million | $45.3 million | ($11.8 million) | (26.0%) |
| Diluted Net Income per Share | $2.86 | $3.70 | ($0.84) | (22.7%) |
Cash Flow Management
Cash provided by operating activities for the thirty-nine weeks ended September 28, 2024, was $98.5 million, up from $94.4 million for the same period in 2023. The company utilized $72.7 million in investing activities, reflecting increased capital investments in breweries, while cash used in financing activities rose to $177.1 million, primarily due to share repurchases.
| Metric | 39 Weeks 2024 | 39 Weeks 2023 | Change ($) |
|---|---|---|---|
| Cash Provided by Operating Activities | $98.5 million | $94.4 million | $4.1 million |
| Cash Used in Investing Activities | $72.7 million | $47.1 million | $25.6 million |
| Cash Used in Financing Activities | $177.1 million | $55.1 million | $122.0 million |
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Article updated on 8 Nov 2024
Resources:
- The Boston Beer Company, Inc. (SAM) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of The Boston Beer Company, Inc. (SAM)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View The Boston Beer Company, Inc. (SAM)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.