[IBU] Miller: Customers Buying Cheaper Beers

Fri May 16 14:36:21 CDT 2008

http://www.manufacturing.net/News-Miller-Customers-Buying-Cheaper-Beers.
aspx?menuid=36
Miller: Customers Buying Cheaper Beers
By Emily Fredrix, AP Business Writer
Manufacturing.Net - May 16, 2008

  <javascript:PrintThisPage()>     
<http://www.addthis.com/bookmark.php>     
<http://www.manufacturing.net/News-Miller-Customers-Buying-Cheaper-Beers
.aspx?menuid=36#EmailColleague>  

MILWAUKEE (AP) -- Consumers still want different types of beers, but for
a growing number with empty pockets, that means less expensive ones, the
chief executive of Miller Brewing Co. said Thursday.

The Milwaukee-based brewer saw a small increase in sales of economy
beers like Milwaukee's Best starting in January, at the expense of
higher-priced brews, Tom Long told The Associated Press in an interview.

It's a direct result of people having less disposable income as they
grapple with higher gas and food prices, he said.

''Thankfully, beers are still quite an affordable luxury, but yes, I
think when people have less disposable income every week, something like
beer is affected,'' Long said.

The beer industry has been stable during tough times in the past, but
executives are watching carefully to see whether the shift toward
cheaper beers continues, he said.

Americans also are spending less in bars and restaurants, and Long said
Miller is starting to see a drop in sales to those businesses.

Long spoke as Miller's parent, London-based SABMiller PLC, announced its
full-year results Thursday.

In the U.S., Miller's revenue rose 4.8 percent to $5.1 billion in the
year that ended March 31. Earnings before interest, taxes and
amortization rose 27 percent to $477 million, though that includes a
gain of $33 million from a settlement of a dispute.

Sales of Miller's two biggest brands -- Miller Lite and Miller High Life
-- were up 1.1 percent each. Miller Lite makes up nearly 46 percent of
the company's sales, while Miller High Life accounts for just over 14
percent. That brand's performance, on the strength of its ad campaign
urging people to ''Take Back The High Life,'' reversed a three-year
decline.

Sales of the company's portfolio of crafts, imports and more expensive
beers also grew in the past year. Craft brand Leinenkugel's, Italian
import Peroni Nastro Azzurro and caffeinated brew Sparks have each shown
double digit growth.

But Miller Genuine Draft's sales were down 10.6 percent as the domestic
premium brand continued to struggle. Economy brew Milwaukee's Best also
saw declines.

Long noted that a new 64-calorie version of Miller Genuine Draft, called
MGD 64, is selling well and will be released nationwide this year.

The company continues to seek new drinks and varieties to appeal to
people's expanding palates, he said. Miller plans to ramp up marketing
again this summer for lime-and-salt flavored Miller Chill, which saw
strong sales during its release last year. With $100 million in revenue,
Miller Chill had one of the most successful brand launches in company
history, SABMiller said.

''We're trying to make sure across the portfolio, we've got something
people are going to want to drink,'' Long said. ''Whether they've got a
pocket full or they're feeling a little bit pinched, that we have the
right beer for them.''

SABMiller did not break out fourth-quarter results. The brewer, the
world's third-largest, said overall revenue was up 15 percent to $21.4
billion.

Lager volume rose 11 percent, driven partly by acquisitions in China and
Europe. Most regions saw growth, including Latin America and Europe,
though sales were flat in South Africa. That's where SABMiller lost its
deal to brew and sell Heineken's Amstel brand.

The company said it was hoping to make up for lost market share with
brands from Dutch brewer Royal Grolsch NV. SABMiller bought the brewer
in February and said it plans to introduce the brand in a number of its
markets over the next year. Miller will distribute Grolsch in the U.S.

Long said he's spending significant time preparing for the proposed
joint venture between Miller and Molson Coors Brewing Co.

The nation's No. 2 and 3 brewers say the pairing -- to be called
MillerCoors -- will help them compete against industry leader
Anheuser-Busch.

The deal, announced late last year, is subject to governmental approval.
Long said it was still on track to clear this summer. He said no
decision had been made on where headquarters would be.

Molson Coors Chief Executive Leo Kiely will be the new CEO of
MillerCoors. Long will be president and chief commercial officer. Pete
Coors, vice chairman of Molson Coors, will serve as chairman of the new
company.

Thank you.  

Steven Becker 

Pioneer Hi-Bred International 

A DuPont Company 

7200 NW 62nd Ave.

P.O. Box 184

Johnston, IA 50131-0184

515-270-3425 

steven.becker at pioneer.com 

www.pioneer.com <http://www.pioneer.com/>  

This communication is for use by the intended recipient and contains
information that may be Privileged, confidential or copyrighted under
applicable law. If you are not the intended recipient, you are hereby
formally notified that any use, copying or distribution of this e-mail,
in whole or in part, is strictly prohibited. Please notify the sender by
return e-mail and delete this e-mail from your system. Unless explicitly
and conspicuously designated as "E-Contract Intended", this e-mail does
not constitute a contract offer, a contract amendment, or an acceptance
of a contract offer. This e-mail does not constitute a consent to the
use of sender's contact information for direct marketing purposes or for
transfers of data to third parties.

Francais Deutsch Italiano  Espanol  Portugues  Japanese  Chinese  Korean

           http://www.DuPont.com/corp/email_disclaimer.html
-------------- next part --------------
An HTML attachment was scrubbed...
URL: http://www.iowabrewersunion.org/pipermail/ibu/attachments/20080516/963800f5/attachment.html 
-------------- next part --------------
A non-text attachment was scrubbed...
Name: not available
Type: image/gif
Size: 145 bytes
Desc: iconPrint.gif
Url : http://www.iowabrewersunion.org/pipermail/ibu/attachments/20080516/963800f5/attachment.gif 
-------------- next part --------------
A non-text attachment was scrubbed...
Name: not available
Type: image/gif
Size: 1536 bytes
Desc: button1-bm.gif
Url : http://www.iowabrewersunion.org/pipermail/ibu/attachments/20080516/963800f5/attachment-0001.gif 
-------------- next part --------------
A non-text attachment was scrubbed...
Name: not available
Type: image/gif
Size: 148 bytes
Desc: iconEmail.gif
Url : http://www.iowabrewersunion.org/pipermail/ibu/attachments/20080516/963800f5/attachment-0002.gif 