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Boston Beer Reports Fourth Quarter Financial Results
SAMBoston Beer(SAM) GlobeNewswire·2025-02-25 21:15

Core Insights - The Boston Beer Company reported a solid finish to 2024 with flat depletions, gross margin expansion, and strong cash generation, indicating improved operational and financial performance [3][4][6] - The company plans to increase advertising investment in 2025 to strengthen its brands and drive long-term sustainable growth [3][5] Fourth Quarter 2024 Summary - Depletions for the fourth quarter were flat compared to the prior year, with shipment volume at approximately 1.5 million barrels, a 0.5% decrease [4][6] - Net revenue for the quarter increased by 2.2% to 402.3million,drivenbypriceincreasesandlowerreturns,despitelowervolumesandincreasedexcisetaxes[5][6]−Grossmarginforthefourthquarterwas39.9402.3 million, driven by price increases and lower returns, despite lower volumes and increased excise taxes [5][6] - Gross margin for the fourth quarter was 39.9%, up 230 basis points year over year, benefiting from increased revenue and procurement savings [6][7] Full Year 2024 Summary - Full-year net revenue was 2.01 billion, a 0.2% increase compared to 2023, with depletions down 2% and shipment volume at approximately 7.5 million barrels, a 2.4% decrease [14][15] - Gross margin for the full year was 44.4%, an increase of 200 basis points year over year, primarily due to price increases and procurement savings [15][16] - The company generated 249millioninoperatingcashflowforthefullyearandendedwith249 million in operating cash flow for the full year and ended with 212 million in cash and no debt [6][14] Advertising and Expenses - Advertising, promotional, and selling expenses for Q4 2024 increased by 10.9millionor8.510.9 million or 8.5% from Q4 2023, driven by higher brand media investments [9][10] - General and administrative expenses rose by 4.0 million or 9.1% from the prior year, mainly due to increased indirect taxes and professional fees [10][18] Impairment and Settlement Costs - The company incurred impairment costs for brewery equipment and other assets of 3.4millioninQ42024,withafull−yearimpairmentof3.4 million in Q4 2024, with a full-year impairment of 7.2 million [11][20] - Contract settlement costs included a 26millioncashpaymentduetoasuppliercontractamendment,impactingthefinancialresults[10][19]ShareRepurchaseandCapitalStructure−Thecompanyrepurchased26 million cash payment due to a supplier contract amendment, impacting the financial results [10][19] Share Repurchase and Capital Structure - The company repurchased 239 million in shares in 2024 and an additional 29millionin2025throughFebruary21,2025[6][25]−Thecompanymaintainsastrongbalancesheet,withsufficientcashandprojectedfutureoperatingcashflowstofundfuturerequirements[24][25]2025Projections−For2025,thecompanyprojectsdepletionsandshipmentstochangebylowsingledigits,withpriceincreasesof129 million in 2025 through February 21, 2025 [6][25] - The company maintains a strong balance sheet, with sufficient cash and projected future operating cash flows to fund future requirements [24][25] 2025 Projections - For 2025, the company projects depletions and shipments to change by low single digits, with price increases of 1% to 2% and a gross margin target of 45% to 47% [28][29] - The effective tax rate is expected to be between 29% and 30%, with GAAP EPS projected between 8.00 and $10.50 [28][29]