Gross profit margin for the company is nearly 5

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level of debt is an industry preference, one which Boston Beer shares. Gross Profit Margin for the company is nearly 5% higher than the industry average; however, Net Profit Margin is less by over 1%. While the company controls costs and pricing better than the industry, it has higher operating expenses. Sales growth of 4.18% seems low compared to the industry, yet further analysis must be done. SAB-Miller, Molson Coors, and Heinken all showed a drop in sales from 2008 to 2009. Craft Brewers Alliance showed a large increase of 65.4%. Anheuser-Busch also showed a substantial increase of 56.37%. Prior analysis of the beer industry in the external analysis showed that major brewers actually saw a significant drop in sales from 2008 to 2009, while craft brewers saw increases. This is illustrated by the results of SAB-Miller, Molson Coors, Heineken, and Craft Brewers Alliance. It is believed that the large increase for Anheuser-Busch was due to its acquisition by InBev in 2008 and subsequent consolidation of financial results. Boston Beer does significantly better than the industry in overall efficiency, achieving, in 2009, a 20.68% return on assets while the industry achieved 5.65% and a 31.4% return on investment while the industry achieved 15.47%. Specific efficiency measures include maintaining inventory of about ten days less than the industry, collecting accounts receivable nearly 36 days faster than the industry, and paying bills three days faster than the industry. From an investor’s viewpoint, Boston Beer has earnings per share in the most recent fiscal year of $2.21 compared to the industry at $1.91 and the company’s price-to-earnings ratio is comparable at 21.05 compared to 23.57 for the industry. When looking at individual company price-to-earnings ratios, Boston Beer is only lower than Craft Brewers Alliance and SAB-Miller. These measures are both positive indicators for the company. Jennifer Pontinen 20
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The data used in this analysis was chosen because it is key in evaluating the performance of the company. All information for The Boston Beer Company was taken from the company’s 2009 Annual Report and Annual 10-K reports filed with the Securities and Exchange Commission. Information on other brewers was taken from each company’s most recent annual report, Annual 10-K reports, Google Finance, and Yahoo Finance. Evaluation of both the income statement and balance sheet is necessary to get the complete picture of financial performance. Analysis of the financial statements will answer questions about sales growth, cost and expense control, investment in assets, and changes in the financing structure of the company. Boston Beer Company has managed considerable sales growth over the last three years by investing in fixed assets, increasing equity, and managing costs and expenses. The company seems well managed and financially responsible.
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  • Spring '15
  • JunLin
  • Management, Brewing, brewers, craft brewers, major brewers

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