UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number:
(Exact name of registrant as specified in its charter)
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(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act.
Title of each class |
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Name of each exchange on which registered |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Accelerated filer |
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Non-accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ____
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act.) Yes ☐ No
Number of shares outstanding of each of the issuer’s classes of common stock, as of April 19, 2024:
Class A Common Stock, $.01 par value |
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Class B Common Stock, $.01 par value |
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(Title of each class) |
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THE BOSTON BEER COMPANY, INC.
FORM 10-Q
March 30, 2024
TABLE OF CONTENTS
PART I. |
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FINANCIAL INFORMATION |
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PAGE |
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Item 1. |
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3 |
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Condensed Consolidated Balance Sheets as of March 30, 2024 and December 30, 2023 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. |
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Item 4. |
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PART II. |
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OTHER INFORMATION |
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Item 1. |
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20 |
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Item 1A. |
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20 |
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Item 2. |
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Item 3. |
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21 |
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Item 4. |
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Item 5. |
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21 |
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Item 6. |
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23 |
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EX-31.1 Section 302 CEO Certification
EX-31.2 Section 302 CFO Certification
EX-32.1 Section 906 CEO Certification
EX-32.2 Section 906 CFO Certification
2
PART I. FINANCIAL INFORMATION
Item 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
THE BOSTON BEER COMPANY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
(unaudited)
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March 30, |
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December 30, |
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Assets |
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Current Assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Accounts receivable |
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Inventories |
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Prepaid expenses and other current assets |
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Income tax receivable |
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Total current assets |
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Property, plant, and equipment, net |
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Operating right-of-use assets |
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Goodwill |
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Intangible assets, net |
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Third-party production prepayments |
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Note receivable |
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— |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities and Stockholders' Equity |
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Current Liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued expenses and other current liabilities |
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Current operating lease liabilities |
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Total current liabilities |
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Deferred income taxes, net |
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Non-current operating lease liabilities |
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Other liabilities |
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Total liabilities |
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(See Note I) |
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Stockholders' Equity: |
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Class A Common Stock, $ |
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Class B Common Stock, $ |
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Additional paid-in capital |
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Accumulated other comprehensive loss |
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Retained earnings |
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Total stockholders' equity |
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Total liabilities and stockholders' equity |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
3
THE BOSTON BEER COMPANY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATIONS
(in thousands, except per share data)
(unaudited)
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Thirteen weeks ended |
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March 30, |
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April 1, |
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Revenue |
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$ |
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$ |
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Less excise taxes |
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Net revenue |
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Cost of goods sold |
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Gross profit |
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Operating expenses: |
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Advertising, promotional, and selling expenses |
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General and administrative expenses |
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Impairment of brewery assets |
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Total operating expenses |
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Operating income (loss) |
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Other income: |
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Interest income |
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Other expense |
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Total other income |
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Income (loss) before income tax provision (benefit) |
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Income tax provision (benefit) |
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Net income (loss) |
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$ |
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$ |
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Net income (loss) per common share – basic |
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$ |
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$ |
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Net income (loss) per common share – diluted |
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$ |
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$ |
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Weighted-average number of common shares – basic |
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Weighted-average number of common shares – diluted |
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Net income (loss) |
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$ |
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$ |
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Other comprehensive (loss) income: |
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Foreign currency translation adjustment |
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Total other comprehensive (loss) income |
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Comprehensive income (loss) |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
4
THE BOSTON BEER COMPANY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
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Thirteen weeks ended |
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March 30, |
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April 1, |
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Cash flows used in operating activities: |
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Net income (loss) |
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$ |
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$ |
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Adjustments to reconcile net income (loss) to net cash used in operating activities: |
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Depreciation and amortization |
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Impairment of brewery assets |
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Gain on sale of property, plant, and equipment |
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Change in right-of-use assets |
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Stock-based compensation expense |
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Deferred income taxes |
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Other non-cash expense (income) |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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( |
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Inventories |
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( |
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Prepaid expenses, income tax receivable, and other assets |
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Third-party production prepayments |
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Accounts payable |
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Accrued expenses and other liabilities |
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( |
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Operating lease liabilities |
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( |
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( |
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Net cash used in operating activities |
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Cash flows used in investing activities: |
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Cash paid for note receivable |
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Purchases of property, plant, and equipment |
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( |
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Proceeds from disposal of property, plant, and equipment |
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Net cash used in investing activities |
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( |
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Cash flows used in financing activities: |
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Repurchases and retirement of Class A common stock |
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Proceeds from exercise of stock options and sale of investment shares |
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Cash paid on finance leases |
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Payment of tax withholding on stock-based payment awards and investment shares |
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( |
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( |
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Net cash used in financing activities |
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( |
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Change in cash and cash equivalents |
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Cash and cash equivalents at beginning of period |
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Cash and cash equivalents at end of period |
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$ |
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$ |
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Supplemental disclosure of cash flow information: |
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Income tax refunds, net of payments |
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$ |
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$ |
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Cash paid for amounts included in measurement of lease liabilities |
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Operating cash outflows from operating leases |
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$ |
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$ |
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Operating cash outflows from finance leases |
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$ |
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$ |
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Financing cash outflows from finance leases |
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$ |
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$ |
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Right-of-use-assets obtained in exchange for finance lease obligations |
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$ |
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$ |
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(Decrease) increase in accounts payable and accrued expenses for purchases of property, plant, and equipment |
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$ |
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$ |
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Increase in accrued expenses for non-cash financing activity – accrued excise taxes on share repurchases |
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$ |
314 |
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$ |
219 |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
5
THE BOSTON BEER COMPANY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
For the thirteen weeks ended March 30, 2024 and April 1, 2023
(in thousands)
(unaudited)
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Class A |
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Accumulated |
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Class A |
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Common |
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Class B |
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Class B |
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Additional |
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Other |
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Total |
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Common |
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Stock, |
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Common |
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Common |
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Paid-in |
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Comprehensive |
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Retained |
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Stockholders’ |
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Shares |
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Par |
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Shares |
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Stock, Par |
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Capital |
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Loss |
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Earnings |
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Equity |
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Balance at December 30, 2023 |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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Net income |
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Stock options exercised and restricted |
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— |
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( |
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Stock-based compensation expense |
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Repurchase and retirement of Class A Common Stock |
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( |
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( |
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( |
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( |
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Foreign currency translation adjustment |
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( |
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( |
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Balance at March 30, 2024 |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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Class A |
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Accumulated |
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Class A |
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Common |
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Class B |
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Class B |
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Additional |
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Other |
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Total |
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Common |
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Stock, |
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Common |
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Common |
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Paid-in |
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Comprehensive |
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Retained |
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Stockholders’ |
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Shares |
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Par |
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Shares |
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Stock, Par |
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Capital |
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Loss |
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Earnings |
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Equity |
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Balance at December 31, 2022 |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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Net loss |
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( |
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( |
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Stock options exercised and restricted |
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( |
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( |
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Stock-based compensation expense |
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Repurchase and retirement of Class A Common Stock |
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( |
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( |
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( |
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( |
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Foreign currency translation adjustment |
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Balance at April 1, 2023 |
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$ |
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$ |
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$ |
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$ |
( |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
6
THE BOSTON BEER COMPANY, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
A. Organization and Basis of Presentation
The Boston Beer Company, Inc. and certain subsidiaries (the “Company”) are engaged in the business of selling alcohol beverages throughout the United States and in selected international markets, under the trademarks “The Boston Beer Company®”, “Twisted Tea Brewing Company®”, “Hard Seltzer Beverage Company”, “Angry Orchard® Cider Company”, “Dogfish Head® Craft Brewery”, “Dogfish Head Distilling Co.”, “Angel City® Brewing Company”, “Coney Island® Brewing Company”, "Green Rebel Brewing Co.", and "Truly Distilling Co.".
The accompanying unaudited condensed consolidated balance sheet as of March 30, 2024, and the unaudited condensed consolidated statements of comprehensive operations, stockholders’ equity, and cash flows for the interim periods ended March 30, 2024 and April 1, 2023, respectively, have been prepared by the Company in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, certain information and footnotes normally included in financial statements prepared in accordance with GAAP have been condensed or omitted. All intercompany accounts and transactions have been eliminated. These condensed consolidated financial statements should be read in conjunction with the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 30, 2023.
In the opinion of the Company’s management, the Company’s unaudited condensed consolidated balance sheet as of March 30, 2024 and the results of its condensed consolidated comprehensive operations, stockholders’ equity, and cash flows for the interim periods ended March 30, 2024 and April 1, 2023, reflect all adjustments (consisting only of normal and recurring adjustments) necessary to present fairly the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year.
B. Recent Accounting Pronouncements
New accounting pronouncements are issued periodically by the FASB and are adopted by the Company as of the specified effective dates. Unless otherwise disclosed below, the Company believes that recently issued and adopted pronouncements will not have a material impact on the Company’s financial position, results of operations and cash flows or do not apply to the Company’s operations.
In November 2023, the FASB issued ASU 2023-07—Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU applies to all public entities that are required to report segment information in accordance with Topic 280, Segment Reporting. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted and the standard should be applied retrospectively. ASU 2023-07 will be effective for the Company's fiscal year ending December 28, 2024. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements and disclosures.
In December 2023, the FASB issued ASU 2023-09—Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU was issued to address investor requests for more transparency about income tax information through improvements to income tax disclosure primarily related to the rate reconciliation and income taxes paid information, and to improve the effectiveness of income tax disclosures. This ASU is effective for public entities for annual periods beginning after December 15, 2024. Early adoption is permitted. ASU 2023-09 will be effective for the Company in the first quarter of its fiscal year ending December 27, 2025. The Company is currently evaluating the impact the adoption of this ASU will have on its consolidated financial statements and disclosures.
C. Revenue Recognition
During the thirteen weeks ended March 30, 2024 and April 1, 2023, approximately
The Company recognizes revenue when obligations under the terms of a contract with its customer are satisfied; generally, this occurs with the transfer of control of its products. Revenue is measured as the amount of consideration expected to be received in exchange
7
for transferring products. If the conditions for revenue recognition are not met, the Company defers the revenue until all conditions are met. As of March 30, 2024 and December 30, 2023, the Company has deferred $
Customer promotional discount programs are entered into by the Company with distributors for certain periods of time. The reimbursements for discounts to distributors are recorded as reductions to net revenue and were $
Customer programs and incentives are a common practice in the alcohol beverage industry. Amounts paid in connection with customer programs and incentives are recorded as reductions to net revenue or as advertising, promotional and selling expenses, based on the nature of the expenditure. Customer incentives and other payments made to distributors are primarily based upon performance of certain marketing and advertising activities. Depending on applicable state laws and regulations, these activities promoting the Company's products may include, but are not limited to point-of-sale and merchandise placement, samples, product displays, promotional programs at retail locations and meals, travel and entertainment. Amounts paid to customers in connection with these programs that were recorded as reductions to revenue or as advertising, promotional and selling expenses for the thirteen weeks ended March 30, 2024 and April 1, 2023 were $
D. Inventories
Inventories consist of raw materials, work in process and finished goods which are stated at the lower of cost, determined on the first-in, first-out basis, or net realizable value. Raw materials principally consist of hops, malt, flavorings, fruit juices, other brewing materials and packaging. The Company’s goal is to maintain on hand a supply of at least one year for essential hop varieties, in order to limit the risk of an unexpected reduction in supply. Inventories are generally classified as current assets. The Company classifies hops inventory in excess of two years of forecasted usage in other long-term assets. The cost elements of work in process and finished goods inventory consist of raw materials, direct labor and manufacturing overhead.
|
|
March 30, |
|
|
December 30, |
|
||
|
|
(in thousands) |
|
|||||
Current inventory: |
|
|
|
|
|
|
||
Raw materials |
|
$ |
|
|
$ |
|
||
Work in process |
|
|
|
|
|
|
||
Finished goods |
|
|
|
|
|
|
||
Total current inventory |
|
|
|
|
|
|
||
Long term inventory |
|
|
|
|
|
|
||
Total inventory |
|
$ |
|
|
$ |
|
||
As of March 30, 2024 and December 30, 2023, the Company has recorded inventory obsolescence reserves of $
8
E. Goodwill and Intangible Assets
The Company’s intangible assets as of March 30, 2024 and December 30, 2023 were as follows:
|
|
|
|
|
As of March 30, 2024 |
|
|
As of December 30, 2023 |
|
|||||||||||||||||||
|
|
Estimated |
|
|
Gross |
|
|
Accumulated |
|
|
Net Book |
|
|
Gross |
|
|
Accumulated |
|
|
Net Book |
|
|||||||
|
|
Life (Years) |
|
|
Value |
|
|
Amortization |
|
|
Value |
|
|
Value |
|
|
Amortization |
|
|
Value |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|||||||
Trade names |
|
Indefinite |
|
|
$ |
|
|
$ |
- |
|
|
$ |
|
|
$ |
|
|
$ |
— |
|
|
$ |
|
|||||
Customer relationships |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||||
Total intangible assets, net |
|
|
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||||
Amortization expense in the thirteen weeks ended March 30, 2024 and April 1, 2023 was approximately $
Fiscal Year |
|
Amount (in thousands) |
|
|
Remainder of 2024 |
|
$ |
|
|
2025 |
|
|
|
|
2026 |
|
|
|
|
2027 |
|
|
|
|
2028 |
|
|
|
|
2029 |
|
|
|
|
Thereafter |
|
|
|
|
Total amortization expense |
|
$ |
|
|
F. Third-Party Production Prepayments
During the thirteen weeks ended March 30, 2024 and April 1, 2023, the Company brewed and packaged approximately
Total third-party production prepayments were $
At current production volume projections, the Company believes that it will fall short of its future annual volume commitments at certain third-party production facilities and will incur shortfall fees. The Company expenses the shortfall fees during the contractual period when such fees are incurred as a component of cost of goods sold. During the thirteen weeks ended March 30, 2024 and April 1, 2023, the Company recorded $
9
|
|
Expected Shortfall Fees to be Incurred |
|
|
|
|
(in millions) |
|
|
Remainder of 2024 |
|
$ |
|
|
2025 |
|
|
|
|
2026 |
|
|
|
|
2027 |
|
|
|
|
2028 |
|
|
|
|
2029 |
|
|
|
|
Thereafter |
|
|
|
|
Total shortfall fees expected to be incurred |
|
$ |
|
|
G. Note Receivable
The Company and City Brewing entered into a Loan and Security agreement on January 2, 2024 at which time payment of $
The Company determined the fair value of the note receivable on the issuance date to be $
H. Net Income (Loss) per Share
The Company calculates net income (loss) per share using the two-class method, which requires the Company to allocate net income to its Class A Common Shares, Class B Common Shares and unvested share-based payment awards that participate in dividends with common stock, in the calculation of net income (loss) per share.
The Class A Common Stock has no voting rights, except (1) as required by law, (2) for the election of Class A Directors, and (3) that the approval of the holders of the Class A Common Stock is required for (a) certain future authorizations or issuances of additional securities which have rights senior to Class A Common Stock, (b) certain alterations of rights or terms of the Class A or Class B Common Stock as set forth in the Articles of Organization of the Company, (c) other amendments of the Articles of Organization of the Company, (d) certain mergers or consolidations with, or acquisitions of, other entities, and (e) sales or dispositions of any significant portion of the Company’s assets.
The Class B Common Stock has full voting rights, including the right to (1) elect a majority of the members of the Company’s Board of Directors and (2) approve all (a) amendments to the Company’s Articles of Organization, (b) mergers or consolidations with, or acquisitions of, other entities, (c) sales or dispositions of any significant portion of the Company’s assets, and (d) equity-based and other executive compensation and other significant corporate matters. The Company’s Class B Common Stock is not listed for trading. Each share of the Class B Common Stock is freely convertible into one share of Class A Common Stock, upon request of the respective Class B holder, and participates equally in dividends.
The Company’s unvested share-based payment awards include unvested shares (1) issued under the Company’s investment share program, which permits employees who have been with the Company for at least
Included in the computation of net income (loss) per diluted common share are dilutive outstanding stock options and restricted stock that are vested or expected to vest. At its discretion, the Board of Directors grants stock options and restricted stock to senior management and certain key employees. The terms of the employee stock options are determined by the Board of Directors at the time of grant. To date, stock options granted to employees vest over various service periods and/or based on the attainment of certain performance criteria and generally expire after ten years. In December 2018, the Employee Equity Incentive Plan was amended to permit the grant of restricted stock units. The restricted stock units generally vest over
10
non-employee directors upon election or re-election to the Board of Directors. The number of option shares granted to non-employee directors is calculated based on a defined formula and these stock options vest immediately upon grant and expire after ten years.
Net Income (Loss) per Common Share - Basic
The following table sets forth the computation of basic net income (loss) per share using the two-class method:
|
|
Thirteen weeks ended |
|
|||||
|
|
March 30, |
|
|
April 1, |
|
||
|
|
(in thousands, except per share data) |
|
|||||
Net income (loss) |
|
$ |
|
|
$ |
( |
) |
|
Allocation of net income (loss) for basic: |
|
|
|
|
|
|
||
Class A Common Stock |
|
$ |
|
|
$ |
( |
) |
|
Class B Common Stock |
|
|
|
|
|
( |
) |
|
Unvested participating shares |
|
|
|
|
|
( |
) |
|
|
|
$ |
|
|
$ |
( |
) |
|
Weighted average number of shares for basic: |
|
|
|
|
|
|
||
Class A Common Stock |
|
|
|
|
|
|
||
Class B Common Stock |
|
|
|
|
|
|
||
Unvested participating shares |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Net income (loss) per share for basic: |
|
|
|
|
|
|
||
Class A Common Stock |
|
$ |
|
|
$ |
( |
) |
|
Class B Common Stock |
|
$ |
|
|
$ |
( |
) |
|
Net Income (Loss) per Common Share - Diluted
The Company calculates diluted net income (loss) per share for common stock using the more dilutive of (1) the treasury stock method, or (2) the two-class method, which assumes the participating securities are not exercised.
The following table sets forth the computations of diluted net income (loss) per share, assuming the conversion of all Class B Common Stock into Class A Common Stock for the thirteen weeks ended March 30, 2024 and for the thirteen weeks ended April 1, 2023:
|
|
Thirteen weeks ended |
|
|||||||||||||||||||||
|
|
March 30, 2024 |
|
|
April 1, 2023 |
|
||||||||||||||||||
|
|
Earnings to |
|
|
Common |
|
|
EPS |
|
|
Earnings to |
|
|
Common |
|
|
EPS |
|
||||||
|
|
(in thousands, except per share data) |
|
|||||||||||||||||||||
As reported - basic |
|
$ |
|
|
|
|
|
$ |
|
|
$ |
( |
) |
|
|
|
|
$ |
( |
) |
||||
Add: effect of dilutive common |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Share-based awards |
|
|
— |
|
|
|
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|||
Class B Common Stock |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||||
Net effect of unvested participating |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|||
Net income (loss) per common share - |
|
$ |
|
|
|
|
|
$ |
|
|
$ |
( |
) |
|
|
|
|
$ |
( |
) |
||||
For the thirteen weeks ended March 30, 2024, in accordance with the two-class method, weighted-average stock options to purchase
11
For the thirteen weeks ended April 1, 2023, in accordance with the two-class method, weighted-average stock options to purchase
I. Commitments and Contingencies
Contractual Obligations
As of March 30, 2024, projected cash outflows under non-cancelable contractual obligations are as follows:
|
|
Commitments |
|
|
|
|
(in thousands) |
|
|
Ingredients and packaging (excluding hops and malt) |
|
$ |
|
|
Brand support |
|
|
|
|
Equipment and machinery |
|
|
|
|
Hops and malt |
|
|
|
|
Other |
|
|
|
|
Total commitments |
|
$ |
|
|
The Company expects to pay $
Litigation
The Company is party to legal proceedings and claims, including class action claims, where significant damages are asserted against it. Given the inherent uncertainty of litigation, it is possible that the Company could incur liabilities as a consequence of these claims, which may or may not have a material adverse effect on the Company’s financial condition or the results of its operations. The Company accrues loss contingencies if, in the opinion of management and its legal counsel, the risk of loss is probable and the loss can be estimated. Material pending legal proceedings are discussed below.
J. Income Taxes
The following table provides a summary of the income tax provision for the thirteen weeks ended March 30, 2024 and April 1, 2023:
|
|
Thirteen weeks ended |
||
|
|
March 30, |
|
April 1, |
Effective tax rate |
|
|
||
The increase in the tax rate for the thirteen weeks ended March 30, 2024 as compared to the thirteen weeks ended April 1, 2023 is primarily due to the tax deficiency related to stock-based compensation awards recorded on pre-tax income for the thirteen weeks ended March 30, 2024, compared to the tax deficiency related to stock-based compensation awards on a pre-tax loss for the thirteen weeks ended April 1, 2023.
As of both March 30, 2024 and December 30, 2023, the Company had approximately $
12
The Company’s practice is to classify interest and penalties related to income tax matters in income tax expense. As of March 30, 2024 and December 30, 2023, the Company had approximately $
K. Line of Credit
In December 2022, the Company amended its credit facility in place that provides for a $
L. Fair Value Measures
The Company defines fair value as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).
The Company’s cash and cash equivalents are held in money market funds. These money market funds are measured at fair value on a recurring basis (at least annually) and are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. The money market funds are invested substantially in United States Treasury and government securities. The Company does not adjust the quoted market price for such financial instruments. Cash, accounts receivable, and accounts payable are carried at their cost, which approximates fair value, because of their short-term nature.
At March 30, 2024 and December 30, 2023, the Company had money market funds with a “Triple A” rated money market fund. The Company considers the “Triple A” rated money market fund to be a large, highly-rated investment-grade institution. As of March 30, 2024 and December 30, 2023, the Company’s cash and cash equivalents balance was $
Non-Recurring Fair Value Measurement
The fair value as of the issuance date of the Company's note receivable is classified within Level 2 of the fair value hierarchy as the fair value was partially derived from publicly quoted inputs of market interest rates for a loan of similar terms, provisions, and maturity.
13
M. Common Stock and Stock-Based Compensation
Option Activity
Information related to stock options under the Restated Employee Equity Incentive Plan and the Stock Option Plan for Non-Employee Directors is summarized as follows:
|
|
Shares |
|
|
Weighted- |
|
|
Weighted- |
|
|
Aggregate |
|
||||
Outstanding at December 30, 2023 |
|
|
|
|
$ |
|
|
|
|
|
|
|
||||
Forfeited/ Expired |
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|||
Outstanding at March 30, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Exercisable at March 30, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Vested and expected to vest at March 30, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
||||
Of the total options outstanding at March 30, 2024,
Non-Vested Shares Activity
The following table summarizes vesting activities of shares issued under the investment share program and restricted stock units:
|
|
Number of Shares |
|
|
Weighted Average Fair Value |
|
||
Non-vested at December 30, 2023 |
|
|
|
|
$ |
|
||
Granted |
|
|
|
|
|
|
||
Vested |
|
|
( |
) |
|
|
|
|
Forfeited |
|
|
( |
) |
|
|
|
|
Non-vested at March 30, 2024 |
|
|
|
|
$ |
|
||
Of the total non-vested shares at March 30, 2024,
On March 1, 2024, the Company granted a combined
Stock-Based Compensation
The following table provides information regarding stock-based compensation expense included in operating expenses in the accompanying condensed consolidated statements of comprehensive operations:
|
|
Thirteen weeks ended |
|
|||||
|
|
March 30, |
|
|
April 1, |
|
||
|
|
(in thousands) |
|
|||||
Amounts included in advertising, promotional and selling expenses |
|
|
|
|
|
|
||
Amounts included in general and administrative expenses |
|
|
|
|
|
|
||
Total stock-based compensation expense |
|
$ |
|
|
$ |
|
||
Stock Repurchases
14
In 1998, the Company began a share repurchase program. Under this program, the Company's Board of Directors has authorized the repurchase of the Company's Class A Stock. On May 18, 2023, the Board of Directors authorized an increase in the aggregate expenditure limit for the Company’s stock repurchase program by $
During the thirteen weeks ended March 30, 2024, the Company repurchased and subsequently retired
N. Licensing Agreements
Pepsi Licensing Agreement
On August 9, 2021, the Company signed a series of agreements with PepsiCo, Inc. (“Pepsi”) to develop, market, and sell alcohol beverages. Under the agreements, the Company is responsible for developing, manufacturing, and marketing a flavored malt beverage product under the HARD MTN DEW® brand. As part of the agreements, Pepsi provides certain proprietary ingredients and also licenses the Company the use of its HARD MTN DEW® trademark in connection with manufacturing, promoting, marketing, and distributing the developed product, primarily through the Pepsi distribution network.
The Company began shipping flavored malt beverages to Pepsi during the first quarter of 2022. Pursuant to the terms of the agreements, the Company makes payments to Pepsi for proprietary ingredients, freight costs to ship the product to Pepsi, and certain marketing services. The costs of the proprietary ingredients above fair market value are recorded within net revenue at the time revenue is recognized for the flavored malt beverages sold to Pepsi and were $
On February 24, 2024, the Company and Pepsi amended the terms of these agreements, most notably to change distribution from the Pepsi Distribution network to the Company’s distribution network.
O. Related Party Transactions
15
Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is a discussion of the significant factors affecting the consolidated operating results, financial condition and liquidity and cash flows of the Company for the thirteen week periods ended March 30, 2024, as compared to the thirteen period ended April 1, 2023. This discussion should be read in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operations, and the Consolidated Financial Statements of the Company and Notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 30, 2023.
RESULTS OF OPERATIONS
Thirteen Weeks Ended March 30, 2024 compared to Thirteen Weeks Ended April 1, 2023
|
|
Thirteen Weeks Ended |
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
|
March 30, |
|
|
April 1, |
|
|
Amount |
|
|
% change |
|
|
Per barrel |
|
|||||||||||||||||||||
Barrels sold |
|
|
|
|
|
1,592 |
|
|
|
|
|
|
|
|
|
1,579 |
|
|
|
|
|
|
14 |
|
|
|
0.9 |
% |
|
|
|
|||||
|
|
|
|
|
Per barrel |
|
|
% of net |
|
|
|
|
|
Per barrel |
|
|
% of net |
|
|
|
|
|
|
|
|
|
|
|||||||||
Net revenue |
|
$ |
426,052 |
|
|
$ |
267.55 |
|
|
|
100.0 |
% |
|
$ |
410,000 |
|
|
$ |
259.73 |
|
|
|
100.0 |
% |
|
$ |
16,052 |
|
|
|
3.9 |
% |
|
$ |
7.82 |
|
Cost of goods |
|
|
239,704 |
|
|
|
150.53 |
|
|
|
56.3 |
% |
|
|
254,338 |
|
|
|
161.12 |
|
|
|
62.0 |
% |
|
|
(14,634 |
) |
|
|
(5.8 |
)% |
|
|
(10.59 |
) |
Gross profit |
|
|
186,348 |
|
|
|
117.02 |
|
|
|
43.7 |
% |
|
|
155,662 |
|
|
|
98.61 |
|
|
|
38.0 |
% |
|
|
30,686 |
|
|
|
19.7 |
% |
|
|
18.41 |
|
Advertising, promotional, and |
|
|
120,275 |
|
|
|
75.53 |
|
|
|
28.2 |
% |
|
|
125,428 |
|
|
|
79.46 |
|
|
|
30.6 |
% |
|
|
(5,153 |
) |
|
|
(4.1 |
)% |
|
|
(3.93 |
) |
General and administrative |
|
|
50,384 |
|
|
|
31.64 |
|
|
|
11.8 |
% |
|
|
43,694 |
|
|
|
27.68 |
|
|
|
10.7 |
% |
|
|
6,690 |
|
|
|
15.3 |
% |
|
|
3.96 |
|
Impairment of brewery assets |
|
|
335 |
|
|
|
0.21 |
|
|
|
0.1 |
% |
|
|
484 |
|
|
|
0.31 |
|
|
|
0.1 |
% |
|
|
(149 |
) |
|
|
(30.8 |
)% |
|
|
(0.10 |
) |
Total operating expenses |
|
|
170,994 |
|
|
|
107.38 |
|
|
|
40.1 |
% |
|
|
169,606 |
|
|
|
107.45 |
|
|
|
41.4 |
% |
|
|
1,388 |
|
|
|
0.8 |
% |
|
|
(0.07 |
) |
Operating income (loss) |
|
|
15,354 |
|
|
|
9.64 |
|
|
|
3.6 |
% |
|
|
(13,944 |
) |
|
|
(8.84 |
) |
|
|
(3.4 |
)% |
|
|
29,298 |
|
|
|
(210.1 |
)% |
|
|
18.48 |
|
Other income |
|
|
3,455 |
|
|
|
2.17 |
|
|
|
0.8 |
% |
|
|
1,542 |
|
|
|
0.98 |
|
|
|
0.4 |
% |
|
|
1,913 |
|
|
|
124.1 |
% |
|
|
1.19 |
|
Income before income tax provision (benefit) |
|
|
18,809 |
|
|
|
11.81 |
|
|
|
4.4 |
% |
|
|
(12,402 |
) |
|
|
(7.86 |
) |
|
|
(3.0 |
)% |
|
|
31,211 |
|
|
|
(251.7 |
)% |
|
|
19.67 |
|
Income tax provision (benefit) |
|
|
6,212 |
|
|
|
3.90 |
|
|
|
1.5 |
% |
|
|
(3,446 |
) |
|
|
(2.18 |
) |
|
|
(0.8 |
)% |
|
|
9,658 |
|
|
|
(280.3 |
)% |
|
|
6.08 |
|
Net income (loss) |
|
$ |
12,597 |
|
|
$ |
7.91 |
|
|
|
3.0 |
% |
|
$ |
(8,956 |
) |
|
|
(5.68 |
) |
|
|
(2.2 |
)% |
|
$ |
21,553 |
|
|
|
(240.7 |
)% |
|
$ |
13.59 |
|
Net revenue. Net revenue increased by $16.1 million, or 3.9%, to $426.1 million for the thirteen weeks ended March 30, 2024, as compared to $410.0 million for the thirteen weeks ended April 1, 2023, due to increased pricing impacts of $8.1 million, a $4.4 million reduction in returns, and increased sales volume impacts of $3.6 million.
Volume. Total shipment volume increased by 0.9% to 1,592,000 barrels for the thirteen weeks ended March 30, 2024, as compared to 1,579,000 barrels for the thirteen weeks ended April 1, 2023, primarily due to growth in Twisted Tea offset by declines in Truly Hard Seltzer and other brands. Depletions for the thirteen weeks ended March 30, 2024 were flat from the prior year.
Shipments were higher than depletions as the Company believes wholesalers built inventories to support the upcoming peak selling season. The Company believes distributor inventory as of March 30, 2024 was at an appropriate level for each of its brands and averaged approximately four and a half weeks on hand compared to four weeks on hand at the end of the fourth quarter of 2023 and four and a half weeks at the end of the first quarter of 2023.
Net revenue per barrel. Net revenue per barrel increased by 3.0% to $267.55 per barrel for the thirteen weeks ended March 30, 2024, as compared to $259.73 per barrel for the comparable period in 2023, primarily due to price increases and lower returns.
16
Cost of goods sold. Cost of goods sold was $150.53 per barrel for the thirteen weeks ended March 30, 2024, as compared to $161.12 per barrel for the thirteen weeks ended April 1, 2023. The 2024 decrease in cost of goods sold of $10.59, or 5.8%, per barrel was primarily due to decreases in inventory obsolescence of $5.4 million, or $3.39 per barrel, raw materials pricing and recipe optimization of $5.3 million, or $3.33 per barrel, favorable product mix effects of $5.0 million, or $3.14 per barrel and the non-recurrence of 2023 contract settlement costs of $4.5 million, or $2.83 per barrel, partially offset by inflationary impacts of $5.2 million, or $3.27 per barrel.
Inflationary impacts of $5.2 million consist primarily of increased material costs of $3.6 million, and internal brewery costs of $1.6 million.
Gross profit. Gross profit was $117.02 per barrel for the thirteen weeks ended March 30, 2024, as compared to $98.61 per barrel for the thirteen weeks ended April 1, 2023.
The Company includes freight charges related to the movement of finished goods from its manufacturing locations to distributor locations in its advertising, promotional and selling expense line item. As such, the Company’s gross margins may not be comparable to those of other entities that classify costs related to distribution differently.
Advertising, promotional, and selling expenses. Advertising, promotional and selling expenses decreased by $5.2 million, or 4.1%, to $120.3 million for the thirteen weeks ended March 30, 2024, as compared to $125.4 million for the thirteen weeks ended April 1, 2023, primarily due to decreased freight to distributors of $3.6 million from lower rates and improved freight efficiencies, partially offset by higher volumes. Brand investments decreased $1.6 million with decreases in other promotional activity partially offset by increases in media.
Advertising, promotional and selling expenses were 28.2% of net revenue, or $75.53 per barrel, for the thirteen weeks ended March 30, 2024, as compared to 30.6% of net revenue, or $79.46 per barrel, for the thirteen weeks ended April 1, 2023. This decrease per barrel is primarily due to advertising, promotional, and selling expenses decreasing at a higher rate than the increase in shipments. The Company invests in advertising and promotional campaigns that it believes will be effective, but there is no guarantee that such investments will generate sales growth.
The Company conducts certain advertising and promotional activities in its distributors’ markets, and the distributors make contributions to the Company for such efforts. These amounts are included in the Company’s condensed consolidated statements of comprehensive operations as reductions to advertising, promotional and selling expenses. Historically, contributions from distributors for advertising and promotional activities have amounted to between 2% and 3% of net sales. The Company may adjust its promotional efforts in the distributors’ markets, if changes occur in these promotional contribution arrangements, depending on industry and market conditions.
General and administrative expenses. General and administrative expenses increased by $6.7 million, or 15.3%, to $50.4 million for the thirteen weeks ended March 30, 2024, as compared to $43.7 million for the thirteen weeks ended April 1, 2023, primarily due to higher salaries and benefits costs of $10.1 million, which includes an incremental $3.8 million of compensation costs mostly attributable to the Company's Chief Executive Officer transition, partially offset by decreased consulting costs of $3.7 million.
Impairment of brewery assets. Impairment of brewery assets of $0.3 million decreased by $0.1 million from the comparable period of 2023, due to lower write-offs of equipment at Company-owned breweries.
Income tax provision (benefit). The Company’s effective tax rate for the first quarter was a 33.0% provision compared to a 27.8% benefit in the prior year. The increase in the tax rate for the thirteen weeks ended March 30, 2024 as compared to the thirteen weeks ended April 1, 2023 is primarily due to the tax deficiency related to stock based compensation awards recorded on pre-tax income for the thirteen weeks ended March 30, 2024, compared to the tax deficiency related to stock based compensation awards on a pre-tax loss for the thirteen weeks ended April 1, 2023.
LIQUIDITY AND CAPITAL RESOURCES
The Company’s primary sources of liquidity are its existing cash balances, cash flows from operating activities and amounts available under its revolving credit facility. The Company’s material cash requirements include working capital needs, satisfaction of contractual commitments, stock repurchases, and investment in the Company’s business through capital expenditures.
17
Cash decreased to $205.4 million as of March 30, 2024 from $298.5 million as of December 30, 2023, primarily reflecting repurchases of the Company's Class A common stock, a note receivable issued, purchases of property, plant, and equipment, net cash used in operating activities, and payments of tax withholdings on stock-based payment awards and investment shares.
Cash used in operating activities consists of net income (loss), adjusted for certain non-cash items, such as depreciation and amortization, stock-based compensation expense, and other non-cash items included in operating results, and changes in operating assets and liabilities, such as accounts receivable, inventory, accounts payable, and accrued expenses.
Cash used in operating activities for the thirteen weeks ended March 30, 2024 was comprised of net income of $12.6 million and non-cash items of $32.8 million, offset by net outflows for operating assets and liabilities of $50.3 million. Cash used in operating activities for the thirteen weeks ended April 1, 2023 was comprised of a net loss of $9.0 million and non-cash items of $27.7 million, offset by net outflows for operating assets and liabilities of $36.6 million. The decrease in cash used in operating activities for the thirteen weeks ended March 30, 2024 compared to April 1, 2023 is primarily due to higher net income and lower outflows arising from increases in accounts receivable, partially offset by greater outflows arising from increases in inventories.
The Company used $35.7 million in investing activities during the thirteen weeks ended March 30, 2024, as compared to $17.1 million during the thirteen weeks ended April 1, 2023. The increased in investing activity cash outflows is due to a $20.0 million note receivable issued, partially offset by lower capital investments. For both periods, capital investments were made mostly in the Company’s breweries to drive efficiencies and cost reductions and support product innovation and future growth.
Cash used in financing activities was $52.4 million during the thirteen weeks ended March 30, 2024, as compared to $23.1 million during the thirteen weeks ended April 1, 2023. The $29.4 million increase in financing activity cash outflows in 2023 compared to 2022 is primarily due to higher repurchases of the Company's Class A common stock in the current period.
During the period from December 31, 2023 through April 19, 2024, the Company repurchased and subsequently retired 199,811 shares of its Class A Common Stock for an aggregate purchase price of $65.0 million. As of April 19, 2024, the Company had repurchased a cumulative total of approximately 14.3 million shares of its Class A Common Stock for an aggregate purchase price of approximately $998.5 million and had approximately $201.5 million remaining on the $1.2 billion stock repurchase expenditure limit set by the Board of Directors.
The Company expects that its cash balance as of March 30, 2024 of $205.4 million, along with its projected future operating cash flow and its unused line of credit balance of $150.0 million, will be sufficient to fund future cash requirements. The Company’s $150.0 million credit facility has a term not scheduled to expire until December 16, 2027. As of the date of this filing, the Company was not in violation of any of its covenants to the lender under the credit facility.
Critical Accounting Policies
There were no material changes to the Company’s critical accounting policies during the three-month period ended March 30, 2024.
FORWARD-LOOKING STATEMENTS
In this Quarterly Report on Form 10-Q and in other documents incorporated herein, as well as in oral statements made by the Company, statements that are prefaced with the words “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “intend,” “designed” and similar expressions, are intended to identify forward-looking statements regarding events, conditions, and financial trends that may affect the Company’s future plans of operations, business strategy, results of operations and financial position. These statements are based on the Company’s current expectations and estimates as to prospective events and circumstances about which the Company can give no firm assurance. Further, any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update any forward-looking statement to reflect subsequent events or circumstances. Forward-looking statements should not be relied upon as a prediction of actual future financial condition or results. These forward-looking statements, like any forward-looking statements, involve risks and uncertainties that could cause actual results to differ materially from those projected or anticipated. Such risks and uncertainties include the factors set forth below in addition to the other information set forth in this Quarterly Report on Form 10-Q and in the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 30, 2023.
18
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Since December 30, 2023, there have been no significant changes in the Company’s exposures to interest rate or foreign currency rate fluctuations. The Company currently does not enter into derivatives or other market risk sensitive instruments for the purpose of hedging or for trading purposes.
Item 4. CONTROLS AND PROCEDURES
As of March 30, 2024, the Company conducted an evaluation under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer (its principal executive officer and principal financial officer, respectively) regarding the effectiveness of the design and operation of the Company’s disclosure controls and procedures as defined in Rule 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) were effective as of March 30, 2024 to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the requisite time periods and that such disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to its management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
There were no changes in the Company’s internal control over financial reporting that occurred during the thirteen weeks ended March 30, 2024 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
19
PART II. OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
For information regarding the Company's legal proceedings, refer to Note I of the Condensed Consolidated Financial Statements.
Item 1A. RISK FACTORS
In addition to the other information set forth in this report, careful consideration should be given to the factors discussed in Part I, "Item 1A. Risk Factors" in the Company’s Annual Report on Form 10-K for the year ended December 30, 2023, which could materially affect the Company’s business, financial condition or future results. The risks described in the Company’s Annual Report on Form 10-K are not the only risks facing the Company. Additional risks and uncertainties not currently known to the Company or that it currently deems to be immaterial also may materially adversely affect its business, financial condition and/or operating results.
20
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
In 1998, the Company's Board of Directors ("the Board") authorized the Company's share buyback program. In May 2023, the Board authorized an increase in the share buyback expenditure limit set for the program from $931.0 million to $1.2 billion. The Board did not specify a date upon which the authorization would expire. Share repurchases for the periods included herein were effected through open market transactions.
As of April 19, 2024, the Company had repurchased a cumulative total of approximately 14.3 million shares of its Class A Common Stock for an aggregate purchase price of $998.5 million and had $201.5 million remaining on the $1.2 billion share buyback expenditure limit set by the Board.
During the thirteen weeks ended March 30, 2024, the Company repurchased and subsequently retired 148,538 shares of its Class A Common Stock, including 355 unvested investment shares issued under the Investment Share Program of the Company’s Employee Equity Incentive Plan, as illustrated in the table below:
Period |
|
Total Number of Shares |
|
|
Average Price Paid |
|
|
Total Number of Shares |
|
|
Approximate Dollar |
|
||||
December 31, 2023 - February 3, 2024 |
|
|
61,817 |
|
|
$ |
349.89 |
|
|
|
61,525 |
|
|
$ |
244,893 |
|
February 4, 2024 - March 2, 2024 |
|
|
53,335 |
|
|
|
345.82 |
|
|
|
53,328 |
|
|
|
226,450 |
|
March 3, 2023 - March 30, 2024 |
|
|
33,386 |
|
|
|
298.76 |
|
|
|
33,330 |
|
|
|
216,490 |
|
Total |
|
|
148,538 |
|
|
$ |
336.94 |
|
|
|
148,183 |
|
|
$ |
216,490 |
|
As of April 19, 2024, the Company had 9.9 million shares of Class A Common Stock outstanding and 2.1 million shares of Class B Common Stock outstanding.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable
Item 4. MINE SAFETY DISCLOSURES
Not Applicable
Item 5. OTHER INFORMATION
Insider Trading Arrangements
No trading plans were
21
Item 6. EXHIBITS
Exhibit No. |
|
Title |
|
|
|
3.1 |
|
|
|
|
|
3.2
|
|
|
|
|
|
10.1 |
|
|
|
|
|
10.2 |
|
|
|
|
|
*31.1 |
|
|
|
|
|
*31.2 |
|
|
|
|
|
*32.1 |
|
|
|
|
|
*32.2 |
|
|
|
|
|
*101.INS |
|
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
|
*101.SCH |
|
Inline XBRL Taxonomy Extension Schema Document
|
*101.CAL |
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
*101.DEF |
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
*101.LAB |
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
*101.PRE |
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
*104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document)
|
* Filed with this report
22
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.
THE BOSTON BEER COMPANY, INC |
(Registrant) |
Date: April 25, 2024 |
/s/ Michael Spillane |
|
Michael Spillane |
|
President and Chief Executive Officer |
|
(Principal Executive Officer) |
Date: April 25, 2024 |
/s/ Diego Reynoso |
|
Diego Reynoso |
|
Chief Financial Officer |
|
(Principal Financial Officer) |
23
Exhibit 31.1
I, Michael Spillane, certify that:
1. I have reviewed this quarterly report on Form 10-Q of The Boston Beer Company, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: April 25, 2024
/s/ Michael Spillane
-----------------------------------------
Michael Spillane
President and Chief Executive Officer
[Principal Executive Officer]
Exhibit 31.2
I, Diego Reynoso, certify that:
1. I have reviewed this quarterly report on Form 10-Q of The Boston Beer Company, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
Date: April 25, 2024
/s/ Diego Reynoso
-----------------------------------------
Diego Reynoso
Chief Financial Officer
[Principal Financial Officer]
Exhibit 32.1
The Boston Beer Company, Inc.
Certification Pursuant To
18 U.S.C. Section 1350,
As Adopted Pursuant To
Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the Quarterly Report of The Boston Beer Company, Inc. (the "Company") on Form 10-Q for the period ended March 30, 2024 as filed with the Securities and Exchange Commission (the "Report"), I, Michael Spillane, President and Chief Executive Officer of the Company, certify, pursuant to Section 1350 of Chapter 63 of Title 18, United States Code, that this Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in this Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: April 25, 2024
/s/ Michael Spillane
Michael Spillane
President and Chief Executive Officer
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to The Boston Beer Company, Inc. and will be retained by The Boston Beer Company, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.
Exhibit 32.2
The Boston Beer Company, Inc.
Certification Pursuant To
18 U.S.C. Section 1350,
As Adopted Pursuant To
Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the Quarterly Report of The Boston Beer Company, Inc. (the "Company") on Form 10-Q for the period ended March 30, 2024 as filed with the Securities and Exchange Commission (the "Report"), I, Diego Reynoso, Chief Financial Officer of the Company, certify, pursuant to Section 1350 of Chapter 63 of Title 18, United States Code, that this Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in this Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: April 25, 2024
/s/ Diego Reynoso
Diego Reynoso
Chief Financial Officer
A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to The Boston Beer Company, Inc. and will be retained by The Boston Beer Company, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.