Transcript Slide 1

Advertisement: Molson
Presented by:
Simon Wisniewski
Kirsty Au
Michelle Ho
Adam Chamberlain
2
Overview of Presentation
• Industry Overview
History & Background
Global Industry Overview
U.S. Industry Overview
Porter’s Forces and Key Success Factors
• Company Analysis and Recommendations
3
Ancient History
 4300 BC, Babylonian clay tablets detail recipes for beer.
 There is evidence that beer was elaborated by the
Babylonian, Assyrian, Egyptian (for medical purposes),
Hebrew, Chinese, and Inca cultures.
 55 BC Roman legions introduce beer to Northern Europe.
 500-1000 AD the first half of the Middle Ages, brewing
begins to be practiced in Europe, shifting from family
tradition to centralized production in monasteries and
convents (hospitality for traveling pilgrims).
 1200 AD beer making is firmly established as a commercial
enterprise in Germany, Austria, and England.
 1420 German brewers develop the lager method of
brewing.
 1489 Germany's first brewing guild, Brauerei Beck, was
established.
4
Renascence History
 1553 Beck's Brewery founded & still brewing today.
 1587 the first beer brewed in New World at Sir Walter
Raleigh's colony in Virginia.
 1602 Dr. Alexander Nowell discovers that ale can be
stored longer in cork sealed, glass bottles.
 1612 the first commercial brewery opened in New
Amsterdam (NYC, Manhattan).
 1674 Harvard College has its own brew-house.
 1680 William Penn (founder of Pennsylvania) operated a
commercial brewery.
 1786 Molson brewery is founded in what is today
Canada.
 1789 James Madison proposes that Congress levy a low
8-cent duty per barrel on malt liquors to encourage "the
manufacture of beer in every State in the Union."
5
Modern History
 Before the 1800's most beer was really "Ale."
 In the mid-19th Century (1850's) German immigrant
brewers introduced cold maturation lagers to the US
(Anheuser-Busch, Miller, Coors, Stroh, Schlitz, and Pabst
roots begin here).
 The modern era of brewing in the US began in the late
1800's with commercial refrigeration (1860), automatic
bottling, pasteurization (1876), and railroad distribution.
 1870's Adolphus Busch pioneers the use of doublewalled railcars, a network of icehouses to make
Budweiser the first national brand.
 1880 there are approximately 2,300 breweries in the US.
 1890s Pabst is the first US brewer to sell over 1 million
barrels in a year.
6
Modern History
 1914 commercial competition drives the number of
operating breweries down to 1,400.
 1920 Prohibition Starts for beer, even though some
regions started as early as 1846, e.g. Maine. Prohibition
focused more on whiskey and other distilled products.
 1933 Prohibition ends for beer (April 7).
 1935 only 160 breweries survive Prohibition.
 1935 the beer can is introduced (American Can Co. &
Kreuger Brewing).
 1966 Budweiser is the first brand to sell 10 million barrels
in a year.
 1991 the US produces 20% of the world beer volume
(world's largest).
 1993 US retail beer sales exceed $45 Billion.
Source: http://www.beerhistory.com/library/holdings/raley_timetable.shtml
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What is Beer
• Beer is used as a generic term and includes both lager and
ale.
 Lager is lighter in taste and is made with a type of yeast that drops to
the bottom of the fermenting tank.
 More hops are used to brew ale and the yeast rises to the top of the
tank.
 Less than 1% of the market is sold as stout or porter.
• More than 78% of all beer sold in Canada is in returnable
and reusable bottles.
 97 out of every 100 of those bottles come back for cleaning and
refilling. A bottle can be reused 15 to 20 times, preventing enormous
wastage.
 Aluminum beer cans (which account for 15% of all sales) are also
crushed and recycled, as are the beer cartons.
 Draught beer is sold in reusable kegs that can last 15 to 20 years
before they too are also crushed and recycled.
Source: http://www.thecanadianencyclopedia.com/PrinterFriendly.cfm?ArticleId=A0000980
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Brewing Process
1.
2.
3.
4.
5.
6.
7.
Malted barley is weighted, cleaned and
passed through a mill which crushes the
grain.
The crushed malt, called grist, is mixed
with hot water in a mash tank.
It is then boiled at a temperature which
allows the malt to starch and convert to
fermentable sugars called wort.
From the whirlpool, the wort is passed
through a cooler where it is cooled and the
pure yeast culture is added.
During the fermentation the yeast converts
the fermentable sugars in the wort into
alcohol and carbon dioxide gas. Once
completed, the liquid referred to as wort is
now called beer.
Following a prescribed maturation period,
carbon dioxide gas is added and the beer
is passed through a complex filtration
system to remove surplus yeast and
protein matarial. The beer is trasferred to
holding tanks prior to packaging.
The finished beer exits the filter and enters
the serving tank ready to be dispensed.
Source: http://www.fosters.com.au/beer/brewing/brewing_process.asp
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Global Industry Overview
• Beer is a Mature Product.
 Firms try to distinguish themselves by differentiation
 Quality, Innovation, and marketing
• It is the largest seller in the alcohol drinks sector.
• Consumer base: heavily male dominated.
• Although globalization is a general trend in many industries,
the brewing industry has long been lagging behind and has
remained very fragmented.
 5 largest account for approx. 44% of total volume
 Compare this to the cigarette industry - 5 largest, 60%
share
• Sales are seasonal and related to:
 Weather (summer months)
 Holidays: Christmas and the 4th of July in the US
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Current Global Trends
• In the decade between 1988 and 1998 the 10 largest
brewers hardly arose from 35.8% to 37.6%.
• Over the last five years this development has accelerated
strongly, the 10 largest increased by nearly 20% and have
now 57% of the global market.
• Consolidation led by major international brewers
 During recent years brewers like Heineken and Interbrew
have started internationalizing their activities.
 Coors and Molson have merged within last couple of
months.
• Volume growth in developing markets
 China: Second largest market (by sales) and growing.
Largest market in total volume.
 Eastern Europe and Russia
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Global Market Share
2004
Anheuser-Busch,
10.80%
SABM iller,
8.90%
Others, 43.00%
Interbrew, 8.40%
Heineken, 7.60%
Carlsberg, 5.70%
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Kirin, 2.20%
Coors, 2.6
Ambev, 4.70%
Grupo M odelo,
2.80%
Scottish&
Newcastle,
Global Beers
•
•
•
•
•
•
•
•
•
•
•
•
Anheuser-Busch
 Budweiser, Bud Light, Bud Dry, Bud Ice, Michelob, Anheuser World Select, Bare Knuckle Stout,
ZiegenLight, Busch, Natural Light , Various others
SABMiller
 Miller Genuine Draft, Miller High Life, Milwaukee's Best, Nastro Azzurro, Pilsner Urquell, Carling Black
Label, Tyskie Gronie, Castle Lager, Various others
Interbrew (Inbev)
 Brahma, Beck’s, Stella Artois, Hoegaarden, Leffe, Bass, Staropramen, Various others
Heineken
 Heineken, Amstel, Licenses others
Carlsberg
 Carlsberg, Carlsberg Special Brew, Carlsberg Export, Tuborg, Okocim, Various others
Ambev
 Skol, Brahma, Antarctica, Bohemia, Kronenbier, Caracu, Licenses others
Scottish & Newcastle
 John Smith’s, Foster’s, Kronenbourg 1664, MGD, Beck’s, Baltika, Grimbergen, Brugs, Various Others
Grupo Modelo
 Corona Extra, Corona Light, Modelo Especial, Victoria, Negra Modelo, Pacífico, Estrella, León, Montejo
Molson Coors
 Molson Canadian, Molson Ultra, A Marca Bavaria, Pilsner, Molson Export, Carling, Molson Dry, Carling
Black Label, Rickard's Red, Bohemian, Tornade, Kaiser, Various others
 Coors, Coors Light, Aspen Edge, Killian’s, Blue Moon, Keystone, Keystone Ice, Keystone Light, Extra
Gold
Kirin
 Kirin Light, Kirisn Ichiban, Various Others
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Sleeman
 Cream Ale, Honey Brown, Silver Creek, Clear, Original Dark, Premium Light, Steam, Amber, Various
regional brands, Licenses others
Many other producers and microbreweries
Global Beer Consumption
Share
Country
(2001)
US
16.4
China
14.3
Germany
7.3
Brazil
5.8
UK
4.1
Japan
3.6
Mexico
3.5
Russian Federation 3.1
Poland
1.7
France
1.5
Czech Republic
1.2
Canada
Per Capita
Consumption
(in liters)
83.1
15.8
123.1
46.7
97.1
40
48.6
30
60.5
35.9
158.1
83
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Internationalization Matrix
• “Degree of Internationalization”
is evaluated by weighing the
world market share with the
respective ratio of foreign sales
to total sales.
• “Potential of
Internationalization” is
described by weighing the free
cash flow with the number of
subsidiaries supported by the
respective brewing group.
• The size of the circles
corresponds to the respective
group volume in hectoliters.
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Canadian Industry Overview
2003
Total Beer Sales (in HL)
Share of Canadian and Import Beer Sales
Canadian
Beer, 90.3%
Import (U.S.),
2.3%
Import (Other),
7.4%
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Canadian Industry Overview
2003
Packaged Canadian Beer Sales
Cans, 25.0%
Large Bottles,
3.5%
Small Bottles,
71.5%
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Source: http://www.brewers.ca/EN/statistics/asbpages.htm
Canadian Industry Overview
2003
Per Capita Consumption (in Litres)
100
80
Beer (Legal)
60
Beer (Adult)
40
Spirits
Wine
20
0
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
Year
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
Beer (Legal)
93.6
92.88
93.02
92.62
90.58
90.93
90.6
90.69
88.82
89.57
88.45
Beer (Adult)
87.8
87.18
87.33
86.94
85
85.35
85.08
85.22
83.49
84.22
83.22
Spirits
5.64
5.48
5.39
5.36
5.35
5.58
5.83
6.04
6.16
6.72
6.86
Wine
10.25
10.07
10.22
10.44
10.81
10.99
11.44
11.96
12.54
13.11
13.5
Adult is considered to 15 years old and over, Legal Drinking age is 19 years old across Canada except in Quebec,
Manitoba, Alberta where it’s 18 years old.
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U.S. Industry Overview
2004
2004 Beer Seasonality - Volume Sales
Seattle/Tacoma - Supermarkets
Weekly Cases (Thousands)
210
July 4th
190
Hallow een
Bud Bow l
St.Pat 's
Memorial Day
Labor Day
Christmas
New Year's
Th'giving
170
150
130
110
90
70
Source: IRI InfoScan Data
52 Weeks Ending Dec 26, 2004 - Case Basis
19
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Week Ending
Source: http://www.myaccountoverview.com/scripts/MarketOverview.aspx
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U.S. Industry Overview
2004
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Source: http://www.myaccountoverview.com/scripts/MarketOverview.aspx
U.S. Industry Overview
2004
21
Source: http://www.myaccountoverview.com/scripts/MarketOverview.aspx
U.S. Industry Overview
2004
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Source: http://www.myaccountoverview.com/scripts/MarketOverview.aspx
U.S. Market Characteristics
• 3 basic levels of brewing according to annual production:
 High-volume (shipments of over 15 million barrels)
 They account for around 80% of total production.
 All of them are owned by the 3 largest brewing companies in the US
(Anheuser-Busch Inc., Miller Brewing Co., and Adolph Coors Co.).
 Regional (15,000 – 15 million barrels)
 They account for 15% of total production.
 Usually focused on local distribution.
 Many micro-breweries have grown into this category in the last 5
years.
 Largest regional breweries are Stroh Brewery Co., Pabst Brewing
Co., Genessee Brewing Co.
 Small Breweries (less than 15,000 barrels)
 They account for 5% or less of total production.
 Microbreweries and brewpubs (also restaurant-breweries or “craft 23
brewers”).
Source: http://www.beer-brewing.com/US_beer_market.htm
U.S. Market Segments
• The market for beer in the U.S. consists of 3 segments:
 domestic beers, imports, and specialty beers
• Domestic Beers
Sub
 Sub-premium
Premium
25.5%
 Premium
 Super premium
 Malt liquor segments
 Light*
 Ice*
 Dry*
*They are the result of high price competition
during the 1970s and 1980s. They are priced
high and their purpose is to reclaim some of
the revenue lost during the “price wars”.
Super
Premium
18.2%
Premium
56.3%
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U.S. Market Segments
• Import Beers
 Rivalry from imports has never been a big
factor in the beer industry.
 They’re growing steadily (around 5-8% since
1990s).
• Reasons for growth:
 Expanding economy.
 Consumer interest in ‘higher-quality’ (higherpriced) beer.
 From 1995 through 1997 the growth of the
Hispanic community in the US drove the import
category .
 Most importantly, corporate
partnerships/ownerships of foreign breweries
that allow foreign brands to access the local
distribution networks.
 Since 1995 the No. 1 import is Corona Extra
from Cerveceria Modelo.
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U.S. Market Segments
• Specialty Beers:
 Fastest growing segment
(10-15% since 1990).
 They are perceived as
higher quality by
consumers.
 Subcategories include:
 large breweries
 regional breweries
 contract brewing
companies
 microbreweries
 brewpubs
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U.S. Market Structure
• Flat consumption trends: only some international markets
and the micro-brewing segment show growing opportunities.
• Highly Concentrated: The industry includes more than 300
breweries but is dominated by three producers who
command a nearly 80 percent market share:
 Anheuser-Busch (50%)
 Miller Brewing (18%)
 Adolph Coors (11%)
• The market leaders have expanded their respective market
shares at the expense of other national brewers like Strohs
Brewery.
• The industry as a whole has stable and relatively predictable
Cash Flows.
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Source: http://www.deed.state.mn.us/bizdev/PDFs/beer.pdf
U.S. Industry Overview
2004
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U.S. Industry Overview
2004
29
U.S. Market Structure
• Market Leadership:
 Once a firm attains market leadership in a mature industry, it is
difficult for it to be unseated and it offers a company many benefits
over rivals including substantial production economies of scale
advantages.
• Distribution:
 Expensive to ship: beer has low value relative to weight.
 Therefore, several breweries are needed for successful distribution.
 This sometimes explains why large breweries take over small ones.
 This highlights the importance of good distribution networks.
• The importance of branding and pricing:
 Price elasticity of demand.
 Premium Pricing for higher quality perceived beers.
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Source: http://www.deed.state.mn.us/bizdev/PDFs/beer.pdf
U.S. Market Structure
• Virtually all new entrants to the beer industry are niche
players that cater to specialized, often regional but
sometime national, tastes.
 The recent explosion of micro brewers reflects this increased
demand for niche beers.
• Characteristics of the microbrews market segment:
 High barriers to entry (i.e. legal, manufacturing and distribution
costs).
 Small consumer market with less consumer price differentiation (i.e.
low price elasticity) than for major brands.
 Due to the high costs of entry microbrews rely on regional brewers to
produce their products under contract (e.g. Minnesota Brewing,
Samuel Adams).
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Source: http://www.deed.state.mn.us/bizdev/PDFs/beer.pdf
U.S. Market Demographics
• Beer consumption is overwhelmingly male-dominated; men
account for more than 80% of the volume consumed in the
U.S.
• The largest group of male consumers are white and they
favor domestic light beer.
• African American drinkers make up about 10% of the beer
market overall, and they are the biggest consumers of malt
liquors, followed by ice beer.
• Women beer drinkers are more attracted to specialty microbrewed beers than they are to the big brands, due to their
greater variety.
• Craft-beer is more appealing to white beer drinkers than to
African Americans.
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Source: http://www.deed.state.mn.us/bizdev/PDFs/beer.pdf
U.S. Market Trends
• Consolidation (e.g. mergers and acquisitions) due to:
 Flat consumption trends
 Regulatory burdens
 High Taxation
• The market is mature with flat consumption trends due to:
 Increased alcohol awareness
 Slow population growth
 Aging population (young male adults are the largest beer
consumers)
• Changes in tastes
 Shift to “light beer” (started by Miller in 1972 – Miller Light).
 Light beer segment grew from 0% to 23% of US beer
consumption since 1972.
 A-B has deterred Miller’s leadership in this segment. In 2001 Bud
Light became the top selling beer overall.
Source: http://www.deed.state.mn.us/bizdev/PDFs/beer.pdf
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U.S. Industry Regulations
• Regulations focus on:
 Distribution
 Labeling
 Advertising
 Credit
 Container
characteristics
 Alcoholic content
 Tax rates
 Litter assessments
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Source: http://www.beer-brewing.com/US_beer_market.htm
U.S. Beer Distribution
• The brewing industry is organized into a so-called "threetier" distribution system:
1) brewers and importers
2) wholesalers
Exclusive (often partially owned by the brewery)
Anheuser-Busch distributes about 75% of its beer through independent wholesalers;
the remainder is marketed through exclusive wholesalers.
Independent or multi-brand: Unlike wine and spirits wholesalers, which are
generally multi-state operators, beer wholesalers tend to operate within the
boundaries of a single state.
3) retailers
• Under this system, brewers and importers generally
transport their beer to distribution warehouses, where
they are temporarily stored and then reloaded onto
distribution trucks and delivered via a routing system to
individual retailers.
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U.S. Beer Distribution
• In recent years, multi-brand beer wholesalers have been
proliferating
 This is due, in great part, to the consolidation that has marked
the industry for nearly two decades.
 The number of wholesalers has declined from more than 5,000
nationwide in 1970 to fewer than 2,500 today.
 Unlike wine and spirits wholesalers, which are generally multistate operators, beer wholesalers tend to operate within the
boundaries of a single state.
• Over the last decade, the off-premise retail segment for
beer has changed dramatically
 While traditional liquor stores and mom-and-pop operations
continue to account for a significant share of off-premise beer
sales, national retail chains (supermarkets, drug stores,
membership clubs, or convenience stores) are increasingly
accounting for more beer sales .
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U.S. Beer Distribution
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Source: http://www.myaccountoverview.com/scripts/MarketOverview.aspx
U.S. Regulations
• Federal Regulations:
 Formerly issued by the Bureau of Alcohol, Tobacco, and Firearms
(BATF), which was established by the Federal Alcohol
Administration (FAA) Act.
 On November 25, 2002, the Homeland Security Act of 2002 split
the agency into two different agencies.
 The Department of Justice.
 The Alcohol and Tobacco Tax and Trade Bureau (TTB) (kept
within the United States Department of the Treasury).
 TTB responsibilities:
 Enforce the compliance of provisions for the formulation and
labeling of alcoholic beverages, as required by the Internal
Revenue Code and the FAA Act.
 Taxes, distribution and advertising.
 International trade regulations.
 Lab testing (approval of brewing formulas and equipment).
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U.S. Regulations
• State Regulations:
 After Prohibition, state governments were given
considerable authority over the production,
importation, distribution, sale, and consumption of
beer within their borders.
 Regulations vary across states (i.e. Minnesota
requires that the beer label show the alcohol content,
while Michigan does not permit the label to show
alcohol content).
 Other regulations include:






Max – Min alcohol content
Max – Min size of containers
Credit sales
Advertising
Production, distribution and retailing
Taxes
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U.S. Regulations
Allowable Blood Alcohol Level
.08
.08
.10
.10
.08
.10
.08
.08
.10
.10
.08
.10
.08
.10
.10
.10
.08
.10
.08
.10
.08
.08
.10
.08
.10
.08
.10
.08
.08
.10
(DC) .08
.10
.10
.08
.08
.08
.10
.10
.10
.08
.10 .08
.08
.08
.10
.10
.10
.08 .08
.08
.08
.10
.10
.10
.10
.08
.08
.08
.10
.08
.10
.08
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.08
Source Adams Fact Book 2002
U.S. Regulations
• Local Regulations:
 Many states permit local jurisdictions to regulate and
separately tax beer sales, and even to prohibit the sale of
beer within their jurisdiction.
 Georgia, Illinois, Louisiana, Maryland, New York, and Ohio have
cities or counties that impose local beer taxes.
 Jurisdictions in which the sale of alcoholic beverages is
prohibited are called “dry”.
 about 4.3% of the U.S. population live in dry counties.
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Beer Taxation
• Canada ranks very high with respect to
taxes on a case of beer.
 In Canada, commodity and sales taxes
alone make up 52% of the average retail
price of beer, ranking Canada the third
highest.
• Taxes in the United States average
19% - 22nd out of 23 countries
surveyed.
• An increase in alcohol taxes generally
results in a larger increase in retail
price, as wholesalers and retailers add
markups to the products as they move
through the distribution system.
http://www.brewers.ca/EN/
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Porter’s Five Forces Model
Government
Threats of
New Entrants
(Low)
Bargaining Power
Of Suppliers
(Low)
Rivalry
(High)
Availability of
Substitutes
(Medium)
Bargaining Power
Of Buyers
(Medium)
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Porter’s Five Forces
• Threats of new entrants:
 High barriers to entry:
 Capital Intensive (especially in advertising)
 Distribution networks
 Regulations
 Economies of scale in marketing, production and distribution.
• Rivalry (price competition has been decreasing):
 Increasing competition from imported beers (however, national brewers
own part of these breweries).
 2,200 wholesalers and 560,000 retail establishments.
 Creative and enticing advertising by majors.
 Growing popularity of micro-breweries and other craft-beers.
 Alternative: expansion to super-premium beers and other segments with
44
lower demand elasticity.
Porter’s Five Forces
• Substitutes:
 Growth in:
 Premixed drinks
 Alternative malt beverage
 Alternative non-alcoholic drinks (from juices to mineral water)
 However, beer remains the largest drink sector.
• Buyer’s Bargaining Power:
 It changes from segment to segment, but in general:
 Low switching costs
 Brand loyalty
 Increasing health conscience
 However, for craft-beers, which are perceived as having higher
quality, these characteristics may not always hold.
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Porter’s Five Forces
• Suppliers’ Bargaining Power:
 Most supplies come from competitive industries which are more
fragmented than the beer industry.
 Farmers
 Labor (the case of unionized labor)
 The more consolidated supplier is that one supplying bottles/cans.
• Government
 Has the potential to change regulations/laws and taxation levels
46
Key Success Factors
• Low cost structure (Scale of economies and learning)
• Effective marketing & advertising strategy to expanded
market share
• Successful brand loyalty and recognition
• Product innovation and production efficiency
(packaging and automation)
• Distribution (wholesalers’ loyalty)
• International expansion to countries with increasing
consumption trends
• Strategic price increases and premium pricing
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Advertisement: Budweiser (1)
48
Company Overview
Established in 1864
World's largest brewer with 116.8 million of barrels
sold
Focus on 3 key divisions - beer, packaging and
adventure park entertainment
49.6 % in U.S. market in 2004
Bud light has 19.1% of U.S. market
Budweiser is the best selling beer in the world
Rank No.1 in Beverage Industry in Fortune Magazine
2005 - “America’s Most Admired Companies’”
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Distribution Network
Operating 14 breweries, 12 in the United
States and two in China and U.K.
Budweiser is locally brewed in 7 other
countries outside the U.S. : Argentina,
Canada, Ireland, Italy, Japan, South Korea
and Spain.
2/3 of the the volume is delivered by
wholesalers who carry only A-B beer.
50
Products
Approximately 30 beers for sale in the United
States
Budweiser & Bud Light
Busch and Busch Light
Michelob and Michelob Ultra
Hurricane and Malt liquors
Bacardi Silver & Mike’s Hard Lemonade
O’doul’s & non-alcoholic beverages
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Recent International Investment
Purchase Harbin Brewery for $693M, 4th largest
brewer in China
Invest $33M in Convertible bond of TsingTao Brewery
Partnership with Heineken in Italy
Allow Heineken to brew, market and distribute
“Budweiser”
Make use of Heineken distribution network in
Europe
License agreement with Cerveceria Damm, 3rd largest
brewer in Spain
52
Marketing & Growth Strategy
Extensive advertising and promotional activities
Budweiser has been the “Official Beer” sponsor
of Olympics since 1984
Maintain good relationship with wholesalers
Enhance distribution channel
Acquisition of wholesalers
Forming equity partnerships with leading brewers in
high growth markets
Especially China
Increase international presence
Improve productivity and making optimum use of the
brewery’s assets
To reduce the cost of good sold
Advertisement: Budweiser (2)
53
Subsidiaries
Anheuser-Busch Packaging
Busch Agricultural Resources Inc.
Manufacturers Railway Company
Busch Entertainment Corp
50% interest in Grupo Modelo, Mexico.
20% interest: Compania Cervesias Unidas,
Chile
27% interest in TsingTao brewer, China.
100% in Harbin Brewer, China
Reciprocal agreement with Kirin, Japan and
Labatts
54
Successful Investment
With continuous investment in China, A-B’s China
operations increased profits by 45% and volume by 17
% in 2003
Great jump up in International beer sales in 4th quarter,
2004 , right after the acquisition of Harbin Brewery in
3rd quarter.
In Mexico, Budweiser and Bud Light volume increased
25% in 2003, resulting in profit growth for 3rd
consecutive year.
Grupo Modelo, Mexico’s leading brewer, whose
flagship band, Corona, is the No.1 import in U.S.
55
Key Executives
August A Busch III
Patrick T. Stokes
W. Randolph Baker
John E Jacob
Chairman of the Board since 1979
President & CEO since 1981
CFO & Vice President since 1970
Director of Global Communications
Most senior management have over 20 years of
service in the company
56
Stock Information
Trade in NYSE since April 18 1980
Symbol
BUD
Price (Mar 8 2005)
$47.93
Outstanding Shares
790.068 M
P/E
17.32
EPS
2.77
Dividend (Jan.12 05) 24 ½ cents
57
5 Year Stock Price History
58
1 Year Stock Price History
59
Comparison with S&P 500
60
Stock Price Analysis
Valuation Ratios
Bud
Industry
S&P 500
Beta
-0.07
0.08
1
P/E Ratio (TTM)
17.32
18.03
22.08
61
Dividend Analysis
Dividends
Bud
Industry
S&P 500
Dividend Yield
2.06
2.04
2.05
Dividend Yield - 5 Year Avg.
1.6
1.41
1.55
Dividend 5 Year Growth Rate
9.9
9.26
4.15
33.21
28.04
27.61
Payout Ratio
62
Beer Sales Analysis
Reported Beer Volume (millions of barrels)
Fourth Quarter
Full Year Ended December 31
vs. 2003
2004
Domestic
International
Worldwide Brands
Int’l Equity Partner Brands
Total Brands
Barrels
vs. 2003
%
2004
Barrels
%
22.9
Dn 0.3
Dn 1.5%
103.0
Up 0.4
Up 0.4%
4.7
Up 2.5
Up 120.5%
13.8
Up 5.4
Up 64.8%
27.6
Up 2.2
Up 8.8%
116.8
Up 5.8
Up 5.3%
4.6
Dn 0.01
Dn 0.2%
19.3
Up 0.5
Up 2.7%
32.2
Up 2.2
Up 7.4%
136.1
Up 6.3
Up 4.9%
63
2004 Financial Highlights
($ in millions, except per share)
Full Year
2004 vs. 2003
2004
2003
$
%
Gross Sales
$17,160
$16,320
Up $840
Up 5.1%
Net Sales
$14,934
$14,147
Up $787
Up 5.6%
Income Before Income Taxes
$2,999
$2,824
Up $175
Up 6.2%
Equity Income
$404
$345
Up $59
Up 17.2%
Net Income
$2,240
$2,076
Up $164
Up 7.9%
Diluted Earnings Per Share
$2.77
$2.48
Up $.29
Up 11.7%
64
Business Segments Performance
Domestic Beer
Int’l Beer
Packaging
Entertain.
Corporate &
Elims.
Other
Consol.
2004
Gross Sales
$13,371.60
1,015.10
2,276.80
989.3
75.4
-568
$17,160.20
---
---
$880.10
---
4
-884.1
$ ---
$11,350.8
809.9
1,396.7
989.3
71.4
316.1
$14,934.2
Income Taxes
$3,279.4
130.9
163.9
172.7
(2.0)
(745.5)
$2,999.4
Equity Income
---
$404.10
---
---
---
---
$404.10
$2,033.20
485.3
101.6
107.1
-1.2
-485.7
$2,240.30
$12,997.50
797
2,093.60
923.9
74.4
-566.2
$16,320.20
---
---
$869.20
---
4.3
-873.5
$ ---
$10,984.4
636.6
1,224.4
923.9
70.1
307.3
$14,146.7
Income Taxes
$3,118.7
90.8
155.5
162.8
(12.0)
(691.5)
$2,824.3
Equity Income
---
$344.90
---
---
---
---
$344.90
$1,933.60
401.2
96.4
100.9
-7.4
-448.8
$2,075.90
Net Sales:
- Intersegment
- External
Income Before
Net Income
2003
Gross Sales
Net Sales:
- Intersegment
- External
Income Before
Net Income
65
Profit Analysis
Profitability Ratios (%)
Bud
Industry
S&P 500
Gross Margin
39.85
39.31
46.45
EBITD Margin
28.75
25
21.78
Operating Margin
22.51
19.89
22.04
Net Profit Margin
12.3
10.98
14.11
66
Stock Option Plan
Officers, certain employees and directors
Price = market price on the date of option is
granted
Vest over 3 years generally
Max. term of 10 years
67
Share Repurchase
Average net purchase 2-3 % of
outstanding share
In Millions
2004
2003
2002
2001
# of Shares purchase
27.1*
39.4
40.7
28.2
1699.5
1958.9
2,027
1,163.80
790.067
825.783
866
890.43
Amount
Shares Outstanding
* First 9 months in 2004
68
Share Repurchase
Repurchase more shares than those
issued under Stock Option Plan
Enhance dividend growth
Enhance Earning per Share
Drop in Share Repurchase due to
acquisition of Harbin
69
Financial Statements Analysis
70
Income Statement Analysis
• 6.31% increase in Cost of Sales
• 3.7% increase in Marketing, Distribution and
Administrative Expenses
• 5.05% increase in Operating Income
• 6.37% increase in Interest Expenses
• Great jump in Other Income
71
Income Statement Analysis
Financial Strength
Bud
Industry
S&P 500
LT Debt to Equity
3.1
2.32
0.52
Total Debt to Equity
3.1
2.34
0.76
72
Balance Sheet Analysis
•
•
•
•
19.36% increase in Cash
17.5% increase in Inventories
13.63% increase in Debt
13.13% increase in Treasury Stock, at cost
Management Effectiveness
Bud
Industry
S&P 500
Return On Assets (TTM)
11.84%
10.68%
7.41%
Return On Investment (TTM)
13.58%
12.58%
11.23%
Return On Equity (TTM)
82.26%
62.72%
19.59%
73
Cash Flow Analysis
• Generating $2.9403 billion cash flow from operations,
a bit lower than 2003
• Huge increase in working capital
• Acquisition increases due to Harbin
• Higher Dividend paid
• Share repurchase drops
• Issuance of shares increases under the stock option
plan
74
Gordon’s Growth Model
•
•
•
•
•
•
•
Good for stable companies
Paying dividends that grow
Stock Price = Ex (Div/Share)
(k – g)
g = 9.90 % in 5 years
k = 0.1157, Div/Share = 0.93
Expected: $55.668 Actual: $ 47.930
75
Technical Analysis
76
Key Investment Positives
Dominant and growing beer brands
High international growth potential
77
Key Investment Positives
Broad network and foreign partnership
Increasing Domestic Revenue per Barrel
Growth in profit
Increasing and favorable dividend payout
Relatively low stock price at present
78
Key Investment Negatives
High Leverage
Decelerating growth in Domestic
Market
Non stop growth in Marketing and
advertising cost
79
Recommendation
BUY
Advertisement: Budweiser (3)
80
81
History
• Originated in Amsterdam Netherlands
• 1864: Gerard Adriaan Heineken purchased “The
Haystack” brewery
• 1873: Heineken Breweries is incorporated
 Gerard Heineken appointed President
• 1939: Heineken listed on stock market
 Euronext in Amsterdam
 Included in the AEX index
• 1980s: Global expansion
82
Ownership - 1
• Heineken N.V.
 50.005% held by Heineken
Holding N.V.
 49.995% free float
• Heineken Holding N.V.
 50.005% held by L’Arche
Holding S.A.
 43.195% free float
 6.8% Greenfee B.V.
• L’Arche Holding S.A.
 Swiss company
 Owned by Heineken family
83
Management
Anthony Ruys
• Joined 1993
• Chairman of the Executive
Board (2002)
Jean Francois
van Boxmeer
• Joined 1984
• 2001 member of
the executive
board
Marc Bolland
• Joined 1987
• 2001 member
of the executive
board
Rene Graafland
• Joined 1981
• 2002 member of
the executive
board
Karl Buche
• 1993: Chairman of
the executive board of
BBAG
• 2004 member of the
executive board
84
Markets
• World’s leading brewing group
 Operating in over 170 countries
• Own over 115 breweries in over 65 countries
• Ranks 2nd in the world beer market in profitability
• Principal area of activities:
 Europe – accounts for over ½ of Heineken’s sales
 Heineken is the leading beer brand with breweries in
Netherlands, France, Spain, Italy, Greece, and Ireland
• Main export market outside Europe
 U.S. (particularly N.E. of U.S. – New York)
Advertisement: Heineken (1)
85
Sales Revenue
Sales Revenue - Geographical Regions
Africa and
Middle East
8%
Asia/Pacific
4%
The Americas
14%
Western Europe
$6,210
Central and
Eastern Europe
$1,859
The Americas
$1,510
Africa and
Middle East
$835
Asia/Pacific
$467
Central and
Eastern
Europe
17%
Western
Europe
57%
86
Goal and Strategy
Heineken’s goal is to defend and strengthen its
leading global market position and preserve its
independence.
• Achieve a level of sales and profitability which makes it one of the
world’s largest and financially best-performing brewing groups
• Maintain a strong portfolio of beer brands, with Heineken as the leading
international premium beer
• Maintain strong local market positions
 Good sales mix
 Efficient cost structure
* Low-Cost Strategy *
87
The Heineken Business Model
Organic Growth
Top-line growth
•
Building winning brand portfolios, focus on their
flagship Heineken: improve volume, mix, pricing
•
Innovation
•
Sales and marketing excellence
•
Acquisitions
•
Distribution power
•
Partnerships
•
Focus on developing markets
and the premium segment
Cost reduction
•
Continued cost focus in all business area
Cash Generation
•
Business Development
Our shareholders
Strict cash flow management
88
Heineken’s Top-10 Brands
Brand
Sales Volume hl millions
Country
Heineken
22.8
International
Amstel
11.1
International
Cruzcampo
5.3
Spain
Star
3.2
Nigeria
Zywiec
2.5
Poland
Cristal*
2.4
Chile
Ochota
2.4
Russia
Primus
2.0
D.R. Congo, Rwanda
Moretti
2.0
Italy
Gulder
1.9
Nigeria, Ghana
Tatra
1.6
Poland
Specjal
1.5
Poland
*Cristal owned by joint-venture
89
Overview - Distribution
•
Seeks to achieve comprehensive coverage in
each market by:


Forming alliances with independent distributors
Distribute through its own beverage wholesalers
90
Recent Acquisitions & Partnerships
Partnerships:
• FEMSA, USA
• Lion Nathan, Australia
Acquisitions
• Kingway Brewery, China
• Shikhan Brewery, Russia
• Volga Brewery, Russia
• Diageo/Namibian Breweries, Southern Africa
• Diageo Guinness Stout, Russia, 2005
• Sobol Brewery, Russia
• Fürstenbergische Brauerei, Germany
Ìncrease in participating interest
• Hoepfner Brauerei, Germany
• BBAG, C&E Europe
• Würzburger Brauerei, Germany, 2005
• Consolidated Breweries, Nigeria
• Tempo Beer, Israel
• Dinal, Kazakhstan
• DB Group, New Zealand
91
Partnership and Acquisitions
•
Europe: acquired BBAG (Brau Union AG) in July 2003






•
Largest purchase in Heineken’s history
European brewer with leading market positions in Austria, Romania and
Hungary
Owns 22 breweries & sells around 13 million hl of beer
Made Heineken a market leader in 8 Central European countries
Enhance brand’s growth potential (esp in Austria, Romania, Hungary,
and Czech Republic)
February 2004, participating interest increased from 60.3% to 100%
Russia: acquired Shikhan and Volga breweries (August 2004)
and Sobol brewery (December 2004)
•
Various wholesalers in Italy, Spain, and Poland
92
2005 Outlook
•
Invest in €100 million in innovation and high-impact, aggressive
marketing programs to reinforce the Heineken brand equity in USA
•
Improve volumes and sales mix to address the changing consumer
dynamics in Western Europe
•
Continue with business-wide focus on cost reduction
•
Continue to actively pursue their strategy of selective, value-adding
acquisitions in growth markets
•
Heineken brand continue to drive sales mix improvment
 Worldwide, the premium segment of the beer market will continue to
capture an increasing share of the market
•
Innovations
 Consumer focused
93
Financial Review
94
Financial Review
€ / hl million
2004
2003
Increase
Group beer sales volume
113
99
13.8%
Heineken premium brand
19.2
18.5
4.1%
1,329
1,327
0.2%
319
537
334
798
- 32.7%
791
806
Operating Profit BEIA
Net Profit
Net Profit BEIA
- 1.9%
Organic growth in Operating Profit (BEIA)
5.0%
Organic growth in Net Profit (BEIA)
8.1%
Group volume: beer volume sold by consolidated companies and beer of Heineken brewed under license
95
and sold by 3rd parties.
BEIA: Before exceptional items and amortisation of goodwill
Organic Profit: profit excluding the effects of currency movements, first-time consolidations, exceptional
items and amortisation of goodwill.
Exchange Rate Movements
•
Heineken hedges its exposure to the US
dollar

•
•
2004: $1.13 USD = €1
Lower US dollar exchange rate reduced
operating profit by €124 million
Other currencies lowered operating profit by
an additional €34 million
Position
US$ million
2004A
Operating
Profit
- 124
Net
Profit
- 87
96
Review by Region
•
Western Europe (44.7 million hl to 43.5 million hl)
 Weak economy and adverse weather conditions
 Fierce retail competition constrained price increases
•
•
Central and Eastern Europe (20.6million hl to 31.6 million hl)

Launch of Heineken in Brau Union’s distribution network – revenue synergies

Increase in volumes in Russia and Poland
The Americas

•
Operating result fell from € 369 to € 284 million (weakness of the dollar)
Africa and Middle East (12.7 million hl to 13.5 million hl)

•
(12.5 million hl to 14.5 million hl)
Higher beer sales, cost reductions (closure of a brewery in Nigeria), efficiency
improvement programs
Asia Pacific (increased to 9.5 million hl)

All markets in Asia Pacific increased except Singapore
97
Heineken Premium Sales
2003
in m hl
8
2004
0
Western Europe
Central &
Eastern Europe
Americas
Africa & Middle
East
Asia Pacific
Heineken Premium 2004 Highlights
•
Heineken brand growth 4% in challenging market
•
Increasing market share in Europe and the USA
•
Strong brand equity, superior to competition
98
Current Stock Price
•
•
•
•
•
•
•
•
•
Traded on U.S. OTC
Symbol:
Current Price:
52-week HIGH:
52-week LOW:
Outstanding Shares:
EPS (ttm):
P/E ratio (ttm):
Dividend:
HINKY
$34.90
$34.95
$29.30
489.98 million
$1.42
$24.47
$13.96
99
Five Year Stock Performance
BBAG acquisition Aug 2003
public offer for the
outstanding shares (???)
Unknown reason
100
One Year Stock Performance
101
Comparison with S&P500
102
Stock Price Analysis
Valuation Ratios
Heineken
Industry
S&P 500
Beta
0.15
0.08
1
P/E Ratio (TTM)
24.02
18.03
22.08
Price to Sales (TTM)
1.29
2.28
3.05
103
Dividend Price Analysis
Dividends
Heineken Industry
Dividend Yield
S&P 500
1.211
2.04
2.05
Dividend Yield - 5 Year Avg.
1.3
1.41
1.55
Dividend 5 Year Growth Rate
4.56
9.26
4.15
Payout Ratio (TTM)
36.5
28.04
27.61
104
Profit Analysis
Profitability Ratios (%)
Heineken
Industry
S&P 500
Gross Margin (TTM)
39.76
39.31
46.45
EBITD Margin (TTM)
20.2
25
21.78
Operating Margin (TTM)
12.47
19.89
22.04
Net Profit Margin (TTM)
6.22
10.98
14.11
105
Profit Analysis
106
Balance Sheet
•
•
•
•
•
•
•
Financial fixed assets decreased by 31%
Stocks (inventory) decreased by 7%
Cash balance decreased by 53%
Shareholder’s equity increased 7%
Minority ownership decreased 34%
Provisions decreased 58% (including reduction of €100
million of deferred taxes)
Employee Benefits: new for 2004 (reporting changes)

•
Amounted to €680
Liabilities decreased
107
Management Effectiveness
Management Effectiveness
Heineken Industry S&P 500
Return On Assets (TTM)
5.73%
10.68%
7.41%
Return On Investment (TTM)
7.94%
12.58%
11.23%
Return On Equity (TTM)
16.52%
62.72%
19.59%
108
Cash Flow Statement
•
Cash flow from operations increased by €12 million

•
Cash flow from investing activities negative figures in both
years (investments)


•
Lower net working capital (strict working capital control contributed to 93
million)
2004: - € 1,671 million
2003: - € 2.080 million
Negative Net cash flow of - €519 million
109
Financial Strength
Financial Strength
Heineken Industry S&P 500
LT Debt to Equity (MRQ)
0.78
2.32
0.52
Total Debt to Equity (MRQ)
0.78
2.34
0.76
110
Dividend Growth Model
Value of Stock =
Stock Price:
$34.90
DPS1
k-g
Price is calculated as the current intrinsic value of the stock
DPS is the expected dividend paid out in one year
k is the required rate of return on investments
g is the assumed constant growth rate for dividend
g = 0.05
DPS1 = DPS0 (1 + g)
k=
=0.5335(1+0.05)
= 0.56
DPS1 + g
P0
0.56
= $34.90 + g
= 0.06605
0.56
Value of Stock = 0.06605 – 0.05 = $34.89
111
Technical Analysis
112
Recommendation
Investment Positives
Investment Negatives
•
Strong Growth
•
High P/E Ratio
•
Brand Loyalty
•
Competitive Market
•
Low Debt Ratio
•
OTC listing (European)
•
Cash problems
113
Recommendation
HOLD
Advertisement: Heineken (2)
114
115
Company Overview
• Sleeman family started brewing in Guelph
in mid 1800’s
• John H. Sleeman was the original brewer
and Malter for the company
• Five generations of family have been
involved with the company, that has
always taken pride in the product and it’s
heritage
116
Timeline of Sleeman’s
• 1836 – John H. Sleeman opened first brewery
called the Stanford Spring Brewery
• 1933 – Company has been past from John to
George to George A. Sleeman. George A gets
caught smuggling beer into Detroit during
prohibition, issued ultimatum
• 1984 – John W.Sleeman the great-great
grandson of John H. received the historical family
beer receipt book from his aunt.
• 1985 – he reincorporates the business
• 1988 – first beer bottle is filled since 1933
117
Overview Cont…
• Today one of the fastest growing
premium beers in North America
• Number 1 premium beer in Canada and
the 3rd largest brewer.
• Their focus is premium beer but also
produce value beer
118
Overview Cont…
• Company produces over 15 Million Cases
of beer per year, increasing every year.
• Net income over $12 Million and increase
each year
• Through 12 brand and numerous
partnership agreements.
• 15% of total beer Sales in Canada with
$7B
119
Corporate Officers
• John Sleeman – Chairman &CEO
Radio Advertisement: John Sleeman
•
•
•
•
•
•
Rick Knudson – President &COO
Dan Rogozyski –Secretary & VP, Fin & Adm
Dan Fox – Director Ont & Atlantic Canada
Steve Pelkey – Director Western Canada
John Bailey – Director Quebec
John Driggers – Director US exports
120
Premium Brands
•
•
•
•
•
•
Cream Ale
Honey Brown
Silver Creek
Clear
Original Dark
Premium light, Steam,
Amber
• Fine Porter
121
Regional Brands
• Upper Canada - Ont
• Okanagan Springs –
BC&Alta
• Shaftebury – BC&Alta
• Unibroue - Que
• Stroh’s – Value Brand
• Sleeman Maritimes
122
Regional Breweries
• Different locations:
• 2 in Guelph,Ont: Sleeman’s&Upper
Canada
• Chambly, Que
• Darthmouth, NS: Sleeman’s Maritime
• Vernon, BC: Okanagan Springs
123
Distribution Network
• Through breweries located across the country
and in the US. Beer is sold in all provinces in
Canada. Shipped from breweries.
• Select states in the US mostly around brewery
in
• Partnership agreement with Specialist Brand
Development to sell Sleeman’s beer in the UK.
Mostly around London.
124
Partner Brand/Strategic Alliances
•
•
•
•
•
•
Grolsch
Guinness
Pilsner Urquell
Samuel Adams
Sapporo
Scottish and Newcastle
125
Growth Strategies
• Focus on cost management
• Distinctive sales and marketing, with focus on
building premium brands
• Expand production capacity in a cost effective
manner
• Continue to advance in US market
• Evaluate acquisition and expansion
opportunities from multiple standpoints
126
Recent News
• Unibroue
• Sapporro Contract
• Continued growth in the US
127
Unibroue
• Sleeman Acquired in June/04
• Largest Microbrewery in Quebec and among 20
largest in North America
• In 2003: 27.5% of sales were outside of Quebec.
• Sell beer in US, and European markets
• Also in Belgium, Switzerland, Australia and
Germany.
• Unique brewing process, fermented 2 or 3 times
to remove yeast.
128
Corporate Culture
• Values: committed to excellence in dayto-day operations and employees
• Great environment for employees
• Community Involvement: U of Guelph,
Guelph Hospital, United Way, Ducks
Unlimited Canada,
• Good standing within the community
129
Benefits
• Rank #1 in the beverage industry for Corporate
social responsibility by Globe and Mail
• Low turnover
• Internal promotions
• Leads to great work culture, which is need to
foster great employees(#1 asset of company)
• Number of employees has steadily been
increasing over the years.
2001-640 employees, 2002-700, 2003- 750
130
Financial
• Latest stats 3rd Quarter of 2004
• Annual report will be released tomorrow (March 10)
• Compare with 2003 annual numbers
131
Analysis of Balance Sheet
• No cash at the end of the 3rd quarter
• Inventory increase, negative sign
• Intangible assets are over 1/3 of the assets
• Long-term obligations increased substantially
and total liabilities
132
133
Analysis of Income Statement
• Net revenues up 16%
• Gross Margin up 22%
• SG&A expense up 22%
• Net Income up 27%
134
135
Analysis of Cash Flow
• Cash from Operating Activities cut in half
• Change in non-cash from working capital
• Business acquisitions up from Unibroue
acquisition
• Financing has gone up due to purchase
• Net cash is zero
136
5 year Summary
(in thousand of dollars, except for EPS)
Income Statement
Net Revenue
EBITDA
EBITDA
Earnings before Taxes
Net Income
EPS (basic)
EPS (diluted)
2003
2002
2001
2000
1999
185,036
33,401
27,100
21,003
12,253
0.77
0.76
157,053
29,930
24,528
18,511
12,321
0.79
0.77
141,615
28,452
21,365
14,820
9,765
0.64
0.63
134,439
26,463
20,092
13,319
8,969
0.58
0.58
96,110
19,546
14,627
10,869
6,549
0.42
0.41
137
5 year Summary
(in thousands of dollars)
Balance Sheet
Total Assets
Equipment & Leaseholds
Long-term Debt
Shareholders' Equity
Working Capital
2003
2002
2001
2000
1999
243,948
74,691
85,290
103,800
17,606
221,433
70,120
83,622
90,197
5,094
197,642
67,569
80,293
73,088
(1,804)
182,179
58,407
89,987
62,554
(1,775)
166,171
48,596
81,223
58,078
2,670
138
Ratios
2003
Ratios
Current Ratio
LT Debt to Equity
Hectolitres(Proforma)
NBV per Share
2002
2001
2000
1999
1.3
1.1
1
0.8
0.9
1.1
1,273,000 1,134,000 1,024,000
6.48
5.70
4.78
1
1.4
998,000
4.12
1.1
1.4
539,000
3.67
139
Stock Options
2003
Units
Outstanding at start of year 1,341,195
Granted
150,000
Exercised
(177,895)
Forfeited
(41,945)
Outstanding at end of year 1,271,355
Units
2003
Outstanding at start of year 1,341,195
Granted
150,000
Exercised
(177,895)
Weighted
Avg
Forfeited
(41,945)
Outstanding at end of year 1,271,355
Exercise
Weighted Avg
Exercise
Price
Units
2002
$
7.57 1,620,544
$
9.94
48,862
$
7.46 (309,911)
Weighted
Avg
$
10.05
(18,300)
$
7.85 1,341,195
Exercise
Price
$
$
$
$
$
Price
$
$
$
$
$
7.57
9.94
7.46
10.05
7.85
Units
1,620,544
48,862
(309,911)
(18,300)
1,341,195
• # shares outstanding 2002- 15,967,192
•
2003 –16,219,330
2002
Weighted Avg
Exercise
Price
$
7.46
$
10.15
$
7.38
$
7.80
$
7.57
7.46
10.15
7.38
7.80
7.57
140
Stock Price
•
•
•
•
•
•
•
Symbol: ALE
Stock Price:
Market Cap: 244,785,885
Volume:
Trading range(last 52 weeks): 15.65-11.15
P/E Ratio: 16.5
Shares outstanding: 16,482,898
141
Stock Price 5 years
142
Stock Price last year
143
Sleeman vs. S&P500
•
144
Moving Averages
145
Stock Valuation
• The company doesn’t pay dividends as they are
directing all revenues to growing the company at
this stage.
• This is a negative point relative to other breweries
around the world.
• Unable to determine value of the company
• Positive side should see more capital growth from
this company.
Advertisement: Sleeman
146
Recommendation
Moderate
Buy
If can get through takeover of Unibroue in the next year
then, the company would be a BUY
147
Breweries
148