1) Craft Breweries
Market Monitor
Fall 2015
MOSS ADAMS CAPITAL LLC
2) Contents
Industry Update
3
Relevant Transactions
5
Public Company Stock Performance
7
Moss Adams Overview
9
Craft Breweries
2
MOSS ADAMS CAPITAL LLC
3) Craft Beer Industry Snapshot
 The craft beer industry remains hot as we rapidly approach the 4,000 brewery mark, which will likely be hit by the end of the year. The
historic record for most breweries is thought to be 4,311 in 1873. We will likely eclipse this mark by year-end as well.
 There has been a shift to off-premise sales as a growth driver for the larger regional craft breweries; increased competition from new
local microbreweries is likely the cause.
 Significant investor appetite is apparent and has allowed for a much needed increase in capacity to help quench consumer demand.
However, the number of acquisitions by the macro breweries may be numbered as they become content with their portfolio of craft
and have what they need to reclaim lost shelf space.
Craft Beer Sales
Number of Breweries
5,000
D. G. Yuengling
and Son Inc
14%
Boston Beer Co
12%
Sierra Nevada
Brewing Co
5%
millions of barrels
25
17.8
15
10
25.2
21.0
20
6.4
7.3
$4.9
$5.7
'06
'07
5
7.8
$6.2
8.4
$6.8
9.4
$7.9
10.7
$22.5
$18.0
12.4
$13.0
$9.1
1,000
'91
$30
Gambrinus
3%
Next 25 Largest
24%
2,000
0
New Belgium
Brewing Co
4%
30
3,000
$20
$15
$10
$10.7
'09
'10
'11
'13
'97
'99
'01
# of Breweries
'03
'05
'07
'09
'11
'13
'15
est
Breweries Per Capita
(per 1,000 adults)
California
Vermont
8.6
256
Oregon
7.4
Colorado
235
Colorado
6.1
Oregon
216
Montana
5.9
New York
'14 '15 est
431
Washington
$5
'12
'95
Top 5 States by …
$0
'08
'93
$25
$ in millions
All others
38%
4,000
In 2014, the Brewer’s
Association updated
the craft brewer
definition which would
have included 3.3
more barrels in 2013.
181
Wyoming
5.3
Source: Brewers Association, Wall Street research and Moss Adams Capital analysis.
Craft Breweries
3
MOSS ADAMS CAPITAL LLC
4) Current Events
Brewery Expansions
Upcoming Events
Planning to open a 420,000 barrel per year brewery location in the
Western United States
December 3
Brewbound Session
San Diego, CA
Opening 150,000 sq. ft. North Carolina brewery spring 2016
January 22-31
San Francisco Beer Week
February 5-6
Extreme Beer Fest
San Francisco, CA
Opening $30 million Columbus, OH brewery in August 2016
Building third brewery located in Azusa, CA to open in 2017
Boston, MA
Announced 28,000 sq. ft. expansion of North Carolina brewery
May 1-7
Craft Brewers Conference
& BrewExpo America
Philadelphia, PA
May 16-22
American Craft Beer Week
Nationwide
May 29-30
American Craft Beer Fest
Boston, MA
Announced $4 million brewery expansion to open spring 2016
Announced $15 million expansion to increase production to
100,000 barrels per year
Announced brewery expansion to double production to 1 million
barrels per year
Opening 100,000 brewery in Virginia Beach, VA
Source: Beer Street Journal.
Craft Breweries
4
MOSS ADAMS CAPITAL LLC
5) Recent Transactions
2015 is on pace to maintain record activity reached in 2014. If the trend continues throughout the 4th quarter, it will be close to, if
not another record year in the craft brewery
Announced
Date
1
Est.
Production
Target
Location
11/16/15
Ballast Point Brewing & Spirits, Inc.
San Diego, CA
300,000 barrels
Constellation Brands Inc.
09/29/15
Dogfish Head Craft Brewery, Inc.
Milton, DE
250,000 barrels
LNK Partners (15% minority stake)
09/23/15
Golden Road Brewing
Los Angeles, CA
45,000 barrels
Anheuser-Busch Companies, LLC
09/10/15
Saint Archer Brewing Company
San Diego, CA
35,000 barrels
Tenth and Blake Beer Company
09/08/15
Lagunitas Brewing Company
Petaluma, CA
800,000 barrels
Heineken NV (50% stake)
07/16/15
Firestone Walker Brewing Co.
Paso Robles, CA
272,000 barrels
Duvel Moortgat nv
06/17/15
American Sky Brewing Co.
Hudson, WI
03/27/15
Perrin Brewing Company, LLC
Comstock Park, MI
02/24/15
Full Sail Brewing, Inc.
Hood River, OR
01/23/15
Elysian Brewing Company, Inc.
Seattle, WA
12/17/14
Founders Brewing Co.
Grand Rapids, MI
11/10/14
The Alpine Beer Company
Alpine, CA
Number of Announced
Transactions
25
Capital Raise
1,200 barrels
20,000 barrels
115,000 barrels
54,000 barrels
207,000 barrels
3,000 barrels
Acquirer
Lucid Brewing, LLC
Oskar Blues Brewing Company
Encore Consumer Capital
Anheuser-Busch InBev SA/NV
Mahou, S.A. (30% minority stake)
Green Flash Brewing Co.
M&A
20
2
15
1
13
10
5
0
13
3
2
13
16
5
15
15
15
5
18
4
7
3
13
11
3
3
2
5
2
12
10
7
1
3
0
Q1
Q2
Q3
Q4
Q1
2012
Q2
Q3
Q4
2013
Q1
Q2
Q3
2014
Q4
Q1
Q2
Q3
2015
1) Estimated trailing 12 month production at the time of the announcement
Source: S&P Capital IQ.
Craft Breweries
5
MOSS ADAMS CAPITAL LLC
6) Selected Deal Profiles
Constellation Brands (NYSE: STZ) acquires Ballast Point
Brewing & Spirits (San Diego, CA)
November 16, 2015




Constellation Brands entered into an agreement to
acquire Ballast Point Brewing & Spirits (“Ballast Point”)
on November 16, 2015 for approximately $1 billion. The
acquisition plans to be completed by the end of the
calendar year and will be financed with cash and debt.
Ballast Point, best known for its Sculpin IPA, is one of
the leading craft brewers in the U.S., selling nearly
123,000 barrels in 2014. The brewery is expecting
shipments to more than double in 2015, projecting sales
of $115 million (8.7x EV/Revenue). Its incredible
growth combined with its premium price point at $355
a barrel, helped Ballast point reach such a high
transaction multiple.
LNK Partners (White Plains, NY) acquires 15%
stake in Dogfish Head (Milton, DE)
September 29, 2015

LNK Partners (“LNK) entered into an agreement to
acquire a 15% equity stake in Dogfish Head Craft
Brewery (“Dogfish Head”) on September 29, 2015.

Dogfish Head, the country’s 13th largest craft
brewery as of 2014, has over 20 different types of
beers and is expecting to produce 250,000 barrels
in 2015. The brewery plans on using the cash to
help grow the company as the craft brewing market
becomes more crowded with better funded
competition.

Constellation Brands, which owns brands such as
Robert Mondavi Winery, Sky Vodka, and imports
Mexican beers such as Corona, Modelo and Pacifico, will
give Ballast Point cash for growth along with wider
distribution network and stronger buying power for
ingredients and equipment.
Ballast Point started in the back of a home-brew supply
store in 1992, didn’t start selling beer commercially
until 1996, and now ranks as the largest craft brewer in
the U.S. The company produces more than 15 kinds of
beer year-round as well as several craft spirits.

LNK is a New York based private equity firm that
has previously invested in companies Niman Ranch,
Performance Bicycle, Beachbody, Au Bon Pain and
others. Although specifics of the transaction were
not disclosed, LNK typically invests between $50$150 million in a minority or majority equity stake.
Part of the deal included LNK obtaining a seat on
Dogfish Head’s board of directors, which currently
has 5 voting members.
Sam Calagione, Dogfish Head founder, stated he
hopes the investment will eventually fuel enough
growth to repurchase LNK’s 15% stake and remain
a family-controlled business.
Anheuser-Busch InBev (ENXTBR:ABI) acquires
Golden Road Brewing (Los Angeles, CA)
September 23, 2015

Anheuser-Busch InBev (“AB InBev”) signed an
agreement to acquire Los Angeles based Golden
Road Brewing (“GRB”) for an undisclosed amount
on September 23rd, 2015, and expects to close the
transaction by the end of the year.

Founded in 2011, Golden Road Brewing is the
largest craft beer operator in L.A. County, expecting
to sell 45,000 barrels of beer in 2015. The company
distributes approximately 10 different beers with
many more draft-only specialty beers.

GRB will give AB InBev a foothold in the growing
Los Angeles craft beer market, and will join AB
InBev’s growing portfolio of craft breweries
including Goose Island Beer Co., Blue Point
Brewing, 10 Barrel Brewing, and Elysian Brewing.

AB InBev was impressed with what GRB had been
able to accomplish in the past four years, and plans
to keep their expansion plans moving forward. This
plan includes adding several retail locations,
including Orange County, Los Angeles International
Airport and Grand Central Market (Los Angeles) by
2016,.
Source: S&P Capital IQ.
Craft Breweries
6
MOSS ADAMS CAPITAL LLC
7) Continued Growth Leading to Increased Competition

Not surprisingly, sales growth in the Craft Beer segment is expected to dwarf its counterparts, as well as the broader S&P 500 over
the next 12 months. Sales from the large global breweries is expected to decline as a result of the growing popularity of craft beers
and an improving economic environment that pushes consumers to higher-end beverages.

However, as more and more local craft breweries come online, the increased competition hurts off premise sales (grocery and
convenience stores) where drinkers have more choices. This is becoming evident in the two publically-traded craft brewers, Boston
Beer Company (SAM) and Craft Brewers Alliance (BREW). However, these two companies are by no means indicative of the entire
craft brew industry as a whole, which continues to thrive.
Public Market Valuations
Next 12 Months: Estimated Sales Growth
39.0x
8%
34.0x
6.7%
6%
5.7%
29.0x
24.0x
4%
3.3%
19.0x
SAM
15.8x
14.0x
BREW
13.9x
2%
0%
9.0x
(1.0%)
(2%)
Large Breweries
13.5x
S&P 500
10.6x
4.0x
SAM
BREW
Large Brewers
S&P 500
Index
Note: The Craft Breweries and Major Breweries Indices are composed of the public companies included on page 8.
Source: S&P Capital IQ.
Craft Breweries
7
MOSS ADAMS CAPITAL LLC
8) Selected Public Company Valuations
($U.S. in millions, except per share amounts)
TTM Data
11/20/15
Company Name
Share
Price
52 Week
High - Low
Market
Cap
Enterprise
Value
Sales
EBITDA
EV Multiple
EBITDA
Margin
TTM
Sales
TTM
EBITDA
NTM
Sales
NTM
EBITDA
Major Breweries
Anheuser-Busch InBev SA/NV
$125.78
$127.43 - $91.20
$202,115
$248,554
$44,899
$17,276
38.5%
5.5x
14.4x
5.5x
14.0x
SABMiller plc
61.05
62.14 - 42.13
98,866
111,467
15,555
4,676
30.1%
7.2x
23.8x
7.3x
18.6x
Heineken NV
90.68
91.49 - 59.79
52,103
64,470
22,143
4,701
21.2%
2.9x
13.7x
2.9x
12.2x
Molson Coors Brewing Company
92.50
95.74 - 63.91
17,320
19,951
3,697
673
18.2%
5.4x
29.7x
5.5x
14.4x
Asahi Group Holdings, Ltd.
31.69
35.78 - 28.55
14,512
17,796
15,442
1,718
11.1%
1.2x
10.4x
1.2x
10.5x
Carlsberg A/S
87.66
93.16 - 63.29
13,499
18,964
9,726
1,909
19.6%
1.9x
9.9x
2.0x
10.1x
Kirin Holdings Company, Limited
14.15
15.59 - 11.40
12,915
20,140
18,528
2,375
12.8%
1.1x
8.5x
1.1x
9.4x
4.46
7.63 - 4.30
6,599
5,201
4,346
366
8.4%
1.2x
14.2x
1.2x
12.4x
14.78
18.50 - 11.05
3,907
4,032
750
103
13.7%
5.4x
39.3x
4.8x
33.1x
Beijing Yanjing Brewery Co., Ltd.
1.32
2.08 - 1.03
3,722
3,622
1,999
273
13.6%
1.8x
13.3x
1.8x
12.6x
Sapporo Holdings Ltd.
4.37
4.49 - 3.44
1,703
3,559
4,406
335
7.6%
0.8x
10.6x
0.8x
9.8x
Median
$18,964
$9,726
$1,718
13.7%
1.9x
13.7x
2.0x
12.4x
$2,743
$2,609
$963
$204
21.2%
2.7x
12.8x
2.6x
12.8x
161
177
202
13
6.4%
0.9x
13.7x
0.8x
NA
Median
$1,393
$582
$108
13.8%
1.8x
13.2x
1.7x
12.8x
Tsingtao Brewery Company Limited
United Breweries Limited
Craft Breweries
Boston Beer Co. Inc.
Craft Brew Alliance, Inc.
$212.36 $325.00 - $195.04
8.41
14.48 - 6.80
Note: NTM figures are based on the median estimate of Wall St. analysts.
Source: S&P Capital IQ.
Craft Breweries
8
MOSS ADAMS CAPITAL LLC
9) Moss Adams at a Glance
Leadership through Experience and Results
Moss Adams Capital LLC
Moss Adams LLP
•
•
100+ years old – Founded in 1913
•
Largest accounting firm
headquartered in the western U.S.
•
2,200 employees in 27 offices
•
Fully integrated accounting, tax,
and business advisory firm
•
Middle-market specialists
•
The Moss Adams Advantage:
Discrete, highly leverageable
transaction resources and services
•
Investment banking and
strategic advisory services
Focus on privately owned
and family-held
companies
•
Mergers and acquisitions
•
Private debt & equity
placements
•
Mezzanine capital
•
Due Diligence preparation
& advisory
•
Dedicated industry
specialists
Craft Breweries
International Presence
•
Major market affiliates throughout
the U.S. and more than 100
countries around world
9
MOSS ADAMS CAPITAL LLC
10) Moss Adams Capital Overview
Full Service Middle Market Investment Bank
Corporate Finance
•
Capital Placement – Equity and Debt
•
Merger and acquisition advisory
•
Strategic alternatives assessment
•
Exclusive sales and divestitures
•
Strategic planning
•
Management buy-outs
•
Recapitalizations
•
Fairness opinions
•
Comprehensive Industry Coverage
Restructuring and special situations advisory
Aerospace,
Defense &
Government
Services
•
Healthcare
Services &
Products
Industrials /
Niche
Manufacturing
Infrastructure &
Construction
Paper, Plastics, &
Packaging
Real Estate,
Lodging & Leisure
Access to key decision-makers among institutional
investor universe
Food, Beverage &
Agriculture
Technology,
Communications
& Media
Transportation &
Logistics
Completed over 250 transactions
•
Business &
Marketing
Services
Consumer, Retail
& Apparel
Highlights and Accomplishments
Automotive &
Dealer Services
•
Coverage of relevant strategic partners
•
Average of 20 years of investment banking experience
among senior leaders
Craft Breweries
10
MOSS ADAMS CAPITAL LLC
11) Global Reach
Moss Adams is a founding member of Praxity, AISBL, a global alliance of independent accounting firms. In addition to its deep,
direct international relationships, Praxity provides access and trusted advisory expertise worldwide.
Europe
Austria, Belgium, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany,
Hungary, Ireland, Italy, Jersey, Latvia, Lithuania, Luxembourg, Malta, Monaco, Netherlands, Norway,
Poland, Portugal, Romania, Russia, Slovakia, Spain, Sweden, Switzerland, Turkey, United Kingdom ,
Ukraine
North America
United States, Canada
Asia
China, Indonesia, Japan, South Korea,
Malaysia, Singapore, Taiwan, Thailand,
Vietnam
Middle East and
Indian
Subcontinent
Latin America and
Caribbean
Argentina, Brazil, Cayman
islands, Chile, Colombia,
Mexico, Puerto Rico, Uruguay,
Venezuela
Craft Breweries
India, Israel, Lebanon,
Pakistan, United Arab
Emirates
Africa
Algeria, Angola, Benin, Botswana, Cameroon, Cape
Verde, Djibouti, Egypt, Ghana, Ivory Coast, Lesotho,
Madagascar, Mauritius, Morocco, Senegal, South
Africa, Tunisia, Zambia
11
Australasia
Australia, New Zealand
MOSS ADAMS CAPITAL LLC
12) Representative Food & Beverage Transactions
Craft Breweries
12
MOSS ADAMS CAPITAL LLC
13) Contact Us
Contributing Authors:
Tyler Dale
Vice President
(949) 221-4030
tyler.dale@mossadams.com
Bradley Erhart
Associate
(949) 517-9452
bradley.erhart@mossadams.com
James Parr
Analyst
(949) 221- 4099
james.parr@mossadams.com
Moss Adams Capital LLC
2040 Main Street
Suite 900
Irvine, CA 92614
999 Third Avenue
Suite 2800
Seattle, WA 98104
Richard Anderson
Managing Director
(949) 221-4006
rich.anderson@mossadams.com
Robert Miranda
Vice President
(949) 221-4021
robert.miranda@mossadams.com
Wiley Kitchell
Managing Director
(206) 302-6780
wiley.kitchell@mossadams.com
James Rothenberger
Vice President
(206) 302-6777
james.rothenberger@mossadams.com
Harman Wales
Managing Director
(206) 302-6770
jet.wales@mossadams.com
Scott Porter
Vice President
(206) 306-6326
scott.porter@mossadams.com
Craft Breweries
13
Andrew Suen
Vice President
(949) 517-9428
andrew.suen@mossadams.com
MOSS ADAMS CAPITAL LLC