Constellation reported their fiscal year (through Feb), and Crown posted sales up 9% in Dec - Feb fourth quarter. Not much new information on the call that we haven't already covered, except that for the fiscal 2013, Constellation chief Rob Sands said he sees volume moderating to low single digits (higher for calendar year, since they had a great January and February).
PRICING. "I would say in beer pricing Crown did take pricing in the Fall of 2011," said Rob Sands, though "not quite as much as the domestic players." What about going forward? Crown says they will wait and see what the big players do, and if they move up, "we might follow. The import beer price gap to the domestic premium has gotten lower... We're closer priced to the domestic premium, but I would hope that reduction has stopped. ...We're not anticipating a lot of pricing in beer, but if our domestic guys move, we'll probably look at it in certain regions."
ON CONTRACT WITH MODELO. Here's the skinny on the Modelo-Crown JV contract. Modelo must notify Constellation by the end of 2013 if they intend not to renew the contract. When it gets closer to that time, negotiations start. "It's premature to know what any of the parties' intentions are in that regard," said Rob.
NEW BELGIUM TO BUILD BREWERY IN ASHEVILLE, NC
It's official. The buzz has been building for weeks, but Craft Business Daily just reported that New Belgium will be building a new 400k bbl brewery in Asheville, NC, near where Sierra Nevada is also building a brewery (that one with initial 300k bbl capacity). Gov. Perdue, who is a lady mind you, made the announcement at the site. The new brewery breaks ground in 2015.
"After several years of searching we are incredibly excited to have landed in Asheville," said NBB chief Kim Jordan. "From the deep sense of community to the rich natural environment and the opportunity to revitalize a brownfield site near a vibrant downtown, Asheville has everything we've been looking for in a location for our second brewery."
That will put an extra 700k bbls of new capacity on the east coast. Throw in what Dogfish Head, SweetWater, Cigar City, and others are building, there will be lots of barrels available in the East, which has suffered from chronic shortages. What will the addition of NBB and Sierra have on the craft industry out east? Tough to tell. The Southeast has typically been slow to the craft game but is catching up quickly. These additions may speed up that process.
Next issue Monday. Have a prosperous, safe, and enjoyable weekend.
Until then, Harry
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