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Craft Brew Alliance, Inc. (“CB
A”) (Nasdaq:BREW), an independent craft brewing company, today announced final 2013 financial results for the fourth quarter and full year ended December 31st. The Company also confirmed previously reported guidance for 2014 based on continued sales momentum and focus on growing its bottom line.
As previously reported in its preliminary financial release:
Highlights for the fourth quarter 2013 include
A strong close to 2013 highlighted by 10% growth in depletions over the fourth quarter of 2012, the third consecutive quarter of double-digit depletion growth, reflecting continued momentum across the Kona Brewing, Redhook Ale Brewery, Omission and Square Mile Cider Company brand families and stabilization of the Widmer Brothers brand.
An increase in net sales and branded beer shipments of 5% and 6%, respectively, in the fourth quarter attributable to strong sales execution, as well as support from our national partners, wholesalers and retailers.
A decrease in gross margin rate by 100 basis points to 26.0% in the fourth quarter compared to the fourth quarter last year primarily resulting from shifts in product and geographic mix and increased distribution-related costs.
Diluted earnings per share (“EPS”) of $0.04 for the quarter, an increase over fourth quarter 2012 EPS of $0.02, primarily due to improved gross profit and a decrease in selling, general and administrative (“SG&A”) expense.
Highlights for the full year 2013 include
Net sales growth of 6%, reflecting the continued strength of the Kona Brewing, Redhook Brewery and Omission brands, as well as continued repositioning of the Widmer Brothers brand.
Record depletion growth of 11% and owned brands shipment growth of nearly 8%, reflecting the continuing strength of our complementary portfolio of craft beers.
Contract brewing revenue reduction of 40% as a result of the termination of certain contract brewing contracts in late 2012.
Gross margin rate of 28.1%, a reduction of 150 basis points from 2012, primarily due to product mix and distribution costs in our beer business and lower restaurant business margin related to our Woodinville pub remodel.
SG&A expense of $46.5 million, an increase of $1.6 million from 2012, reflecting continued investments in brand development and sales capabilities, partially offset by the leverage of one-time spending in prior years.
EPS of $0.10 versus 2012 EPS of $0.13.
Capital expenditures of approximately $9.9 million, reflecting continued investments in capacity, our pubs, efficiency and quality initiatives.
“We continued to make progress in 2013. It further validates that our distinctive portfolio strategy is well-positioned to drive long-term growth for our business and shareholders in today’s rapidly evolving craft beer market. I’m proud that we achieved our third consecutive quarter of double-digit depletion growth and increased momentum across all of our brands. Our bottom-line performance, however, underscores key opportunities to drive operational improvements and better leverage our national brewing and distribution capabilities,” said CBA Chief Executive Officer Andy Thomas. “As I mentioned in our preliminary announcement, we are wholly committed to applying the same level of resolve and discipline towards improving our bottom line that led to our strong topline growth last year. With our expanded brewing footprint in the Southeast, continued support for our brands, and targeted programs to optimize our supply chain, we are confident in our ability to continue delivering strong topline results while accelerating our bottom-line growth in 2014 and beyond.”