BrewDog USA is cruisin’ in 2019 even amid “toughest environment I have seen in 23 years of selling craft beer,” Chief Rev Officer Adam Lambert shared in email update to his network (as he used to frequently do back in his Dogfish days). BrewDog depletions are up 114% YTD thru May, following co’s best month yet in May with 51K CEs. Recall, BrewDog USA initially expected to hit 25K bbls and $18+ mil in revs last yr, yet co ended up surpassing 36K bbls in 2018, according to Brewers Assn stats (unclear if any contract volume included in BA number).
Over Half of Biz in OH; Mid-Atlantic Growin’ Most; MD with Bond and Buck Dist Notably, 56% of its volume is in OH, growing 90% YTD. Midwest (IN, IL, MI) and Mid-Atlantic divisions are gaining ground, up 132% and 182% respectively, now representing 18% and 22% of total BrewDog biz. Then too, BrewDog added north central WV earlier this yr, as well as 8 new wholesalers in existing territories, DC mkt with Reyes’ Premium Bev in Mid-May, and this week is rolling out MD with Bond and Buck Dist, bringing total footprint to 11 states + DC total (OH, IN, IL, MI, TN, KY, PA, NJ, NY, MD, WV, DC). Co initially planned to add 4-5 states thruout 2019.
Mix Shift Toward Off-Prem, Chains; New Brands 7% of Biz; 12pk 16oz Cans Paying Off BrewDog mix shifting more toward off-prem channels, as total off-prem sales grew 127% YTD representing 60% of total biz, vs on-prem up 97%. Tho in chains, on-prem sales growth (+141%) currently outpacing off-prem (+114%), likely off small base. Natl accts now represent 45% of total biz.
Core portfolio – Elvis Juice, Hazy Jane, Punk IPA, Clockwork Tangerine and Lost Lager – are 86% of total sales, including new Lost Lager and Clockwork Tangerine reaching 7% of total biz YTD as sales accelerating. Lead brands in US, Elvis Juice (+119%) and Hazy Jane (+125%), are each more than doubling, receiving extra boost from new “multi-channel pack size” of 12pk 16oz cans. Recall, pkg is designed to serve on-prem, events and c-stores as well as chains, similarly priced to craft 15pks on cost-per-ounce basis (see Vol 9, #110). Collectively they’re 6% of total BrewDog USA biz YTD.
"Slightly Behind Our Ambitious Goal” Even with strong sales growth nearly halfway thru the year, BrewDog “still trail[s] slightly behind our ambitious 2019 goal,” Adam shared with distribs. Indeed, BrewDog will be going up against tuffer comps thruout rest of 2019, as co grew more than 400% last year per BA stats. Yet BrewDog has already carved out fairly sizable space for itself in US amid ultra-competitive craft mkt. And clearly, co’s sights set higher.