Beverages: Beer and Wine: December Nielsen AOC Data: Beer ... › files ›...

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1 Sherry Whitney From: John Bodnovich <[email protected]> Sent: Tuesday, January 06, 2015 10:32 AM To: John Bodnovich Subject: FW: Industry News Update - Tuesday, January 6 Please consider the environment before printing this e-mail. Beverages: Beer and Wine: December Nielsen AOC Data: Beer and Wine Sales Show Slower Growth to End 2014 Source: CITI January 5, 2015 Total Beer Sales Were Up 2.7% - In the four weeks ended December 20, 2014, beer category sales growth slowed to 2.7% YoY (vs. +3.0% over the last 12 weeks). Category volumes were up 0.5% YoY (vs. +0.7% over the last 12 weeks) such that price/mix added 2.2 pts to dollar sales growth (vs. adding 2.3 pts over the last 12 weeks), while promotional activity was down 1.3 pts (vs. down 1.2 pts over the last 12 weeks). STZ's Beer Sales Growth Improved to +11.5% - Sales for STZ's beer segment were up 11.5% YoY in the period (vs. +10.6% over the last 12 weeks). Volumes were up 10.7% YoY (vs. +9.6% over the last 12 weeks) such that price/mix was a 0.8-pt benefit this month (vs. a 1.0-pt benefit over the last 12 weeks). This month's data showed continued strength in sales trends for Modelo Especial (+29.9% this month vs. +27.6% over the last 12 weeks), Corona Extra (+4.0% vs. +2.9% over the last 12 weeks) and Pacifico (+13.0% vs. +11.5% over the last 12 weeks). BREW's Sales Growth Decelerated to +3.7% - BREW's sales were up 3.7% YoY (vs. +4.9% over the last 12 weeks) as volumes were up 0.5% YoY (vs. +2.5% over the last 12 weeks) while price/mix contributed 3.2 pts to sales growth this month (vs. 2.4 pts over the last 12 weeks). We note that BREW's average pricing was up 3.2% this month, which outpaced the category average. Each of BREW's top three selling brands (in AOC channels) showed slower sales growth this month: Widmer Brothers Hefeweizen slowed to -0.9% (vs. +0.2% over the last 12 weeks); Kona Longboard Lager slowed to +2.4% (vs. +3.6% over the last 12 weeks) and Redhook Longhammer IPA slowed to +1.0% (vs. 1.6% over the last 12 weeks). Total Wine Sales Were Up Just 0.8% - In the four-week period, wine category sales were up just 0.8% YoY (vs. +2.6% over the last 12 weeks), as volume growth slowed to -1.2% (vs. +0.4% over the last 12 weeks), such that price/mix contributed +2.0 pts to sales growth this month (vs. +2.2-pt contribution over the last 12 weeks). Also, promotional activity was down 0.5 pts YoY for the category (vs. -0.7 pts over the last 12 weeks).

Transcript of Beverages: Beer and Wine: December Nielsen AOC Data: Beer ... › files ›...

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Sherry Whitney

From: John Bodnovich <[email protected]>Sent: Tuesday, January 06, 2015 10:32 AMTo: John BodnovichSubject: FW: Industry News Update - Tuesday, January 6

 Please consider the environment before printing this e-mail. 

Beverages: Beer and Wine: December Nielsen AOC Data: Beer and Wine Sales Show Slower Growth to End 2014 Source: CITI January 5, 2015

Total Beer Sales Were Up 2.7% - In the four weeks ended December 20, 2014, beer category sales growth slowed to 2.7% YoY (vs. +3.0% over the last 12 weeks). Category volumes were up 0.5% YoY (vs. +0.7% over the last 12 weeks) such that price/mix added 2.2 pts to dollar sales growth (vs. adding 2.3 pts over the last 12 weeks), while promotional activity was down 1.3 pts (vs. down 1.2 pts over the last 12 weeks). STZ's Beer Sales Growth Improved to +11.5% - Sales for STZ's beer segment were up 11.5% YoY in the period (vs. +10.6% over the last 12 weeks). Volumes were up 10.7% YoY (vs. +9.6% over the last 12 weeks) such that price/mix was a 0.8-pt benefit this month (vs. a 1.0-pt benefit over the last 12 weeks). This month's data showed continued strength in sales trends for Modelo Especial (+29.9% this month vs. +27.6% over the last 12 weeks), Corona Extra (+4.0% vs. +2.9% over the last 12 weeks) and Pacifico (+13.0% vs. +11.5% over the last 12 weeks). BREW's Sales Growth Decelerated to +3.7% - BREW's sales were up 3.7% YoY (vs. +4.9% over the last 12 weeks) as volumes were up 0.5% YoY (vs. +2.5% over the last 12 weeks) while price/mix contributed 3.2 pts to sales growth this month (vs. 2.4 pts over the last 12 weeks). We note that BREW's average pricing was up 3.2% this month, which outpaced the category average. Each of BREW's top three selling brands (in AOC channels) showed slower sales growth this month: Widmer Brothers Hefeweizen slowed to -0.9% (vs. +0.2% over the last 12 weeks); Kona Longboard Lager slowed to +2.4% (vs. +3.6% over the last 12 weeks) and Redhook Longhammer IPA slowed to +1.0% (vs. 1.6% over the last 12 weeks). Total Wine Sales Were Up Just 0.8% - In the four-week period, wine category sales were up just 0.8% YoY (vs. +2.6% over the last 12 weeks), as volume growth slowed to -1.2% (vs. +0.4% over the last 12 weeks), such that price/mix contributed +2.0 pts to sales growth this month (vs. +2.2-pt contribution over the last 12 weeks). Also, promotional activity was down 0.5 pts YoY for the category (vs. -0.7 pts over the last 12 weeks).

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STZ's Wine Sales Declined by 1.0% YoY - STZ's wine sales were down 1.0% YoY this period (vs. +0.5% over the last 12 weeks), driven by a 2.0% volume decline (vs. -0.4% over the last 12 weeks). This month's sales decline was the first monthly decline since April 2014. We note that STZ's portfolio-wide pricing was up 1.0% YoY this period (vs. +0.9% over the last 12 weeks), which represents the 8th straight month of positive pricing (after a streak of 17 consecutive months of lower YoY pricing). ------

A taste for scandal in Italy's Tuscany wine region Source: USA Today Eric J. Lyman January 4, 2015

Tuscany, home to many of Italy's best-known wines, may be in danger of tarnishing its reputation with a series of wine-related scandals. The picturesque region in central Italy is just a victim of its own success, according to Fabrizio Bindocci, a Tuscan winemaker and president of the Brunello di Montalcino consortium. "You don't get people making fraudulent copies of products nobody wants," Bindocci said. Tuscany is known for the quality of its wine more than the quantity it produces, and the U.S. is the largest export market for Tuscan wines, according to the Ministry of Agriculture. The region's wine industry, which produces about 180 million bottles of wine per year, has been rocked in recent months. One winemaker near the Tuscan coast planted a type of grape prohibited in the area and got kicked out of the local Val di Cornia designation in November. A few weeks before that, a major Tuscan wine collector was arrested for trying to sell bottles of bogus high-prestige wines as legitimate. Even bigger, more than a million bottles of low-quality wine - enough to fill half an Olympic-size swimming pool - were seized in two separate busts in September and October. Most of it was destined to be sold under some of Tuscany's best-known labels, including Brunello and Rosso di Montalcino, according to Italian media. In May, another 30,000 bottles falsely labeled as Brunello and other top Tuscan wines - such as Chianti, Chianti Classico and Vino Nobile di Montepulciano - were seized just before being shipped to foreign markets, including the United States.

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Bindocci said the consortium and Tuscan wine producers take the problem seriously. In two of the cases, bogus winemakers secured false certifications, which gave them thousands of extra tags used to guarantee a wine's pedigree. Those tag certifications are now monitored more tightly, Bindocci said. In addition, there are increased controls to assure production levels match the land being cultivated, plus making sure the wine aging in barrels comes from grapes allowed under the region's wine laws. "We are taking every step we can to assure that when a consumer opens a bottle of Brunello di Montalcino it will be the real thing every time," Bindocci said. "We are not underestimating the seriousness of what's been happening." Andy Beal, a U.S.-based reputation management consultant, said regional officials appear to be doing everything they can to reduce any backlash from the recent scandals, including the safeguards Bindocci described. But risks still remain. "When a reputation is damaged, it happens quickly," Beal said. "The time to take action is before - to strengthen the reputation of the region and the products. All signs are that they are doing what they can, but if the bad things keep happening, there will be a tipping point. And once that happens, it becomes much more difficult to confront." Those comments were echoed by Giulia Ceriani, president of Baba Consulting and a communications and sociology professor at the University of Siena, in the heart of Tuscan wine country. "These sorts of problems feed into unfortunate Italian stereotypes as inefficient and sloppy, and they can snowball by being spread by word of mouth and hearsay," Ceriani said. "The risks are great because the value of a luxury product is based on the way it is seen." James Suckling, a leading wine critic who lives part time in Tuscany, said the reputation of Tuscan wine is secure, despite the recent issues. "Every serious wine region has some problems, and in the case of Tuscany, the bad products were caught before they went to market," Suckling said. "What matters is what is in the bottle when a buyer opens it, and Tuscan wine remains one of the world's top wines." Reinforcing his point is an even more high-profile wine scandal a few years ago in Tuscany. In 2008 and 2009, nearly two dozen winemakers were caught using both unauthorized grapes and "adulterated chemicals and other substances" in wine falsely labeled as Brunello.

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Because of the safety issue, the scandal attracted more headlines than the recent events, but that wasn't reflected in the economic impact on the region. "Following the scandals of 2008, what do you think sales of Brunello in the U.S. did in 2009? They rose 6%," said Jason Wilson, a Philadelphia wine educator. "The perception of Tuscan authenticity has never really mattered much for most American consumers," Wilson said. "There's a Tuscany lust in the U.S. that I don't think can be derailed by scandals like this." ------

KFC plan to sell beer, cider criticised Source: SMH January 3, 2015

Fast-food giant KFC is planning to serve beer and cider alongside its chicken and chips at one of its new Sydney stores. KFC has applied for a liquor licence for its new Parramatta store in a bid to keep up with the growing popularity of "fast casual restaurants", which are increasingly offering alcohol on their menus. But public health advocates have criticised the move. A KFC spokeswoman confirmed the "concept" store on Church Street would sell beer and cider, but refused to give further details. It is an apparent attempt by the company to diversify into the fast-growing middle market for fast food dominated by chains such as Mad Mex, Nando's, Guzman y Gomez and Grill'd. But Mike Daube, professor of health policy at Curtin University, condemned the move and urged authorities to deny the company a licence. "KFC is the last place where alcohol should be sold," he said. "This is a company that markets to kids and families. "This comes at a time when kids around the country are watching the KFC Big Bash on TV and at grounds every day. Now they will associate KFC and its marketing not only with junk food but with alcohol." The Parramatta plans appear to take a lead from two pilots launched last year by the global chicken chain's Canadian operations.

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Two Toronto restaurants, made over as KFC Fresh-branded outlets, began selling alcohol late last year. They feature hipster interiors, exposed brick walls and an outdoor balcony and promise "more unique" choices, including mango rice salad, waffle fries and bottled beer. "We want people to linger longer," a company spokesman told the Toronto Star. Documents lodged with Parramatta Council show the company has contracted award-winning interior designers The Great Indoors to plan the fit-out, which features timber-lined windows and exposed ceiling beams. A worker at a neighbouring business said the building had been fitted out for the launch of a "high-end" pilot store operating under the name KFC Urban. Restaurants such as Grill'd style themselvesas "fast casual" eateries. They try to distinguish themselves from typical "quick service" fast-food restaurants by claiming to provide better food and more inviting surroundings. Many also serve alcohol. Fast casual restaurants are the fastest-growing segment of Australia's food market. They grew at 30 per cent in the past five years, analysis by Euromonitor showed, compared to 5 per cent for typical fast food. The Parramatta rebranding came after KFC's arch-rival McDonald's quietly began operating a hipster dining outfit in Camperdown. The Corner, as the McDonald's-owned cafe has been called, shows little sign of its ties to the global giant and offers quinoa salads and pulled-pork sandwiches. A Roy Morgan poll last year found KFC was losing its grip on the youth market to Nando's. Three-quarters of Nando's customers are Generation Y, compared to half for KFC. A spokesman for the Liquor and Gaming Authority confirmed it had received an application for a liquor licence. It said it had asked KFC to provide a statement showing its proposal would not be detrimental to the community's wellbeing, which it had yet to receive. ------

THE CHARMER SUNBELT GROUP ANNOUNCES COMPLETION OF STRATEGIC INITIATIVE ACQUISITION OF PARTNERS' INTERESTS Source: C-SG January 5, 2015

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The Charmer Sunbelt Group, one of the nation's leading distributors of fine wines and spirits, is pleased to announce the purchase of its partners' interests in United Distributors in Delaware and Beverage Distributors in Colorado. As part of the ownership transition in Colorado, Marne Obernauer will join Charmer Sunbelt's Board of Directors. Over the past few years, Charmer Sunbelt completed the acquisition of its partners' interests in Virginia with Associated Distributors, and in South Carolina with Ben Arnold. In September of this year, CSG acquired its partners' interest in R&R Marketing in New Jersey. "This completes a strategy we embarked on several years ago to acquire the interests of our non-operating partners and further streamline our operations" commented Charmer Sunbelt's President, Greg Baird. "The completion of these five acquisitions marks a major milestone for Sunbelt," said Charles Merinoff, CEO of The Charmer Sunbelt Group. "Having accomplished our goal of simplifying our ownership structure, we are well positioned to maximize our strategic alignment with our suppliers and focus on exceptional performance across the country." ------

Constellation Brands: Looking Past the (Near-Term) Horizon Source: RBC Capital Markets Nik Modi January 5, 2015

Our view: We are upgrading STZ shares from Outperform to Top Pick and raising our 12-month price target from $113 to $130 (which represents ~30% upside from current levels). In our upside case scenario, we believe STZ shares are worth $160, driven by upside from white space expansion over the long-run into tequila, craft beer, and cider. Key points: Upgrading to Top Pick: Primarily driven by upside in its beer business (both revenue and margin), STZ shares have delivered solid returns (+40% in 2014 vs. Consumer Staples +13%). With a relative move like this, it is natural to question whether the bull case is strong enough to warrant further upside. So we did the work. The end result of our analysis: we believe STZ is a compelling multi- year investment. Phase I: Near Term (January 2015) - Gracefully Lapping the "Tough Comp": While the overhangs around glass procurement and capacity have been put to rest (since STZ's last EPS call), investors have shown some concern over Constellation's prospects for near-term beer volume growth. As a reminder, Constellation's beer business is coming up against a 17% volume compare for the November quarter (which will be reported on

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January 8). This has created some hesitation to purchase the stock ahead of this "tough comp". Based on our field work, we believe Constellation's beer volumes will "gracefully" lap last year's comparison. We are estimating 6% beer volumes, which implies an underlying acceleration versus the August quarter. What if we are wrong? If Constellation's Beer volumes disappoint, we still believe the stock can move higher based on "Phase II" of our thesis. Phase II: Medium Term (2015-2016) - Fundamental Upside + Yield: Our medium-term thesis, which we believe can stretch over CY2015/16, is the core of our historical bullish stance on STZ: 1) upside to beer volumes/margins; 2) EBIT growth in wine; and 3) initiation of a dividend. We are 3%/9% above consensus FY2015/16 EPS. We build upon this discussion in pages 14-35 of this note. Phase III: Long Term (2017-2025) - White Space: We believe Constellation Brands can sustain its current beer volume momentum by expanding into segments of the beer market that it currently does not play in-craft beer and cider. We estimate that the entry into craft beer and cider could generate 120 bps of upside to our long-term beer volume estimates of 6%. Also, the company's recent acquisition of Casa Noble tequila could drive 40 bps of upside to total spirits' top-line as Constellation expands distribution and steps up marketing. All in, contribution to Constellation's beer and spirits businesses from these new initiatives could generate a total of 70 bps of total incremental annual top-line. Accounting for this incremental growth gets us to our upside valuation case of $160/share. ------

Nomura: BEVERAGES - Boston Beer Source: Nomura January 5th

Buy, TP $320, Magnificent Mundy Just before Christmas (I was already on my way to the mince pie factory in the north) the Magnficent Mundy produced a quite magnificent initiation of The Boston Beer Company. Despite the high valuation he loves the strong positioning in craft, the growth in the cider business, the highly visible top line growth and lack of emerging markets headache. Over and above our $320 price target we see several potential levers for value creation including margin recovery, international expansion and a normalised capital structure which could take the target to $400. Strong top-line growth outlook. We initiate coverage of The Boston Beer Company (SAM) with a Buy rating and target price of USD 320. Despite a slowdown in the core lager brand, we believe the company can increase revenues over the medium term by low double digits given a strong record of innovation and a strong position within hard cider. In

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the current environment of emerging market volatility and risk of deflation in western Europe, good visibility on the top-line growth outlook and 96% exposure to the US is attractive, in our view. Sensitivities - could justify a target price of USD 400. We identify several potential levers for value-creation over and above the organic growth story. Our target price of USD 320 is based on our DCF value of the existing business; however, we see additional value worth as much as USD 80 per share (25% upside potential, over and above our target price) from margin recovery, international expansion and a normalised capital structure. Strong balance sheet. SAM has a strong balance sheet, with net debt/EBITDA close to zero and a history of buying back its shares. Although we do not regard the controlling shareholder as a seller at present, in the medium term, this asset is likely to look attractive to other beverages companies wanting more exposure to craft. Valuation - inexpensive on a PEG basis relative to peers. Trading at a calendar 2015E P/E of 36x, the stock may appear expensive relative to the international brewers trading at 20.3x and with an EV/EBITDA of 17.8x vs the beer average of 11.9x. However, SAM has consistently traded at a premium, and the valuation looks more reasonable on a PEG basis (2.1x vs the beer average of 2.9x) and a P/E-to-revenue-growth basis (2.7x vs the beer average of 3.9x). ------

Anheuser-Busch Settles Claims It Hid Kirin Beer's US Origin Source: Law360 By Carolina Bolado January 05, 2015

Anheuser-Busch Cos. LLC has settled a class suit filed by two Miami residents accusing the company of deceiving consumers into thinking that Kirin beer is still imported from Japan, when in fact it is brewed by the company at two U.S. locations using domestic ingredients. Florida Judge John Thornton granted preliminary approval Dec. 17 to a settlement that will get Kirin purchasers up to $50 per household in reimbursement for Kirin they bought while thinking it was imported. Under the terms of the deal, consumers who bought Kirin from Oct. 25, 2009, through Dec. 17, 2014, will be able to receive 50 cents per six-pack of 12-ounce bottles, $1 per 12-pack of 12-ounce bottles, or 10 cents for each individual bottle or can. Reimbursements supported by proofs of purchase are capped at $50 per household, while those without proof of purchase will get no more than $12 total, according to the settlement.

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Anheuser-Busch also agreed to more prominently include the phrase: "Brewed under Kirin's strict supervision by Anheuser-Busch in Los Angeles, CA and Williamsburg, VA" on Kirin beer bottles, to add it to all consumer-facing packages, and to refrain from describing the beer as imported, according to the deal. The bottles already include that phrase in fine print, according to the complaint. In addition, the settlement includes a $1 million award for the class counsel. In the suit, filed in October 2013, lead plaintiffs Lady J. Suarez and Gustavo E. Oliva, who say they had each been buying about one six-pack of Kirin a month before finding out it was not made in Japan, claim the brewing giant violated the Florida Deceptive and Unfair Trade Practices Act with its packaging, marketing and selling practices for the beer. Anheuser-Busch is responsible for Kirin in the United States under an agreement with the Kirin Brewery Co. Kirin beer was first made in Japan in the 1880s. Anheuser-Busch Cos., a subsidiary of Anheuser-Busch InBev SA/NV, started to manufacture Kirin in the United States on behalf of the Kirin Brewing Co. in 1996, and under a 2006 agreement also took on responsibility for the brand's marketing and sales, according to the complaint. The plaintiffs claim that the packaging, marketing and advertising of Kirin is "designed to deceive consumers into believing they are purchasing Japanese beer." The six-pack cases do not indicate that the beer is made in the United States, but depict a dragon-like Kirin creature from Japanese myth next to Japanese characters, the complaint says. The Anheuser-Busch website also claims that "Kirin Ichiban and Kirin Light are imported Japanese-style pilsners," the complaint says. The labels on individual bottles of Kirin do include fine print along the edge that states: "Brewed under Kirin's strict supervision by Anheuser-Busch, in Los Angeles, CA and Williamsburg, VA," the complaint says. The plaintiffs argue that this disclosure is inadequate, however, because it cannot be seen unless the bottle is removed from the six-pack holder and that reasonable consumers do not read the fine print until after they have purchased the beer. Representatives for the parties could not be reached for comment Monday. The plaintiffs are represented by Lance A. Harke and Howard M. Bushman of Harke Clasby & Bushman LLP, by Thomas A. Tucker Ronzetti, Adam M. Moskowitz and Tal Lifshitz of Kozyak Tropin & Throckmorton PA, and by Robert W. Rodriguez.

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Anheuser-Busch is represented by Edward M. Crane of Skadden Arps Slate Meagher & Flom LLP, and by Stanley Wakshlag, Richard H. Critchlow and Janelle M. Herrera of Kenny Nachwalter PA. The case is Suarez et al. v. Anheuser-Busch Cos. LLC, case number 2013-33620-CA-01, in the Circuit Court of the Eleventh Judicial Circuit of Florida. ------

The 20 Most Influential Beer Websites in the World (2015) Source: beerbloggersconference.org January 5, 2015

One year ago we created the first-ever analysis of the most influential beer websites in the world. Below is an updated version for 2015. Our analysis includes three factors: Alexa Rating: While this is not a perfect indicator of a website's popularity, it is easy to access and relatively accurate. Facebook Likes: Given the influence of social media, we considered the number of Facebook likes. Twitter Followers: The same goes for Twitter. We dropped incoming links as a factor in this year's analysis because Google's tool for this as become increasingly inaccurate. We analyzed a total of 85 popular English-language beer-related websites. We allocated from 25 to 1 points for each time a site was in the top 25 of one of the above three factors. In other words, the website with the best Alexa rating received 25 points and the website with the 25th best Alexa rating received one point. With three categories, the maximum score is 75. We recorded data on January 1, 2015. 20 Most Influential Beer Websites in the World Score 1 Heineken www.heineken.com 63 2 Beer Advocate http://beeradvocate.com 57 3 Dogfish Head Craft Brewery www.dogfish.com 52 4 New Belgium Brewing www.newbelgium.com/ 50 5 Stone Brewing Company http://stonebrewing.com/ 48 6 Bud Light www.budlight.com 45 7 tie Budweiser www.budweiser.com 42 7 tie Coors Light www.coorslight.com 42 9 Miller Lite www.millerlite.com 41

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10 Untapped http://untappd.com/ 29 11 Sierra Nevada Brewing Company www.sierranevada.com 28 12 Rogue Ales www.rogue.com 26 13 Samuel Adams www.samueladams.com 25 14 tie Drink Craft Beer www.drinkcraftbeer.com 24 14 tie BJ's Brewhouse http://bjsbrewhouse.com/ 24 14 tie Dos Equis www.dosequis.com 24 14 tie BrewDog www.brewdog.com 24 14 tie RateBeer.com www.ratebeer.com 24 19 tie Guinness www.guinness.com 22 19 tie More Beer! www.morebeer.com 22 Our top three websites: Heineken remains the Most Influential Beer Website in the World with 63 out of a possible 75 points. It dominates in number of Facebook fans (over 19 million), scored fifth in Alexa rating, and rated 9th in the number of Twitter followers. Beer Advocate magazine again took the number two spot, scoring first in both Alexa rating with a score of 6,832 (meaning it is the 6,832nd most popular website in the world but the most popular beer website in terms of visitors that use the Alexa toolbar) and number of Twitter followers (490,054). Dogfish Head surpassed New Belgium Brewing as the third-most influential beer website primarily because we dropped the Google incoming links factor, which favored New Belgium. Other interesting facts about the analysis: The average Alexa rating of the top 25 most popular beer websites is 17% lower than last year. This means the most popular beer websites are 17% more popular than last year compared to all other websites in the world. This is pretty amazing, especially since the number of websites increases every year. The sum of Facebook fans of the top 25 most popular beer websites on Facebook grew from 56 million to 62 million, while the sum of Twitter followers grew from 2.2 million to 3.2 million, a 45% increase in just one year. Big brewery websites dominate in terms of Facebook fans. Budweiser, Bud Light, Guinness, Coors Light, Dos Equis, Miller Light, Carlsberg, Corona, and Tiger Beer are the top 10, all with over one million fans. However, craft breweries take three of the top five spots in the rankings (Dogfish Head, New Belgium, and Stone) thanks in part because only Miller Lite out of the big boys competes with them in terms of Twitter followers. Why this is, we don't know.

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Please remember the following. We undoubtedly made mistakes. Take a look at the data (Most Influential Beer Websites Analysis), which shows only those sites receiving a score, and please provide any corrections or sites we are missing so we can update future versions. This analysis is a snap shot in time. The stats change daily. We'll do this analysis again next year. Deciding what factors into the ranking is arbitrary. We know Alexa rating is biased towards a certain type of site visitor and realize social media plays heavily into these results. We are open to other suggestions but think this is a good start. ------

Wetherspoon and Heineken settle Irish dispute Source: FT Kadhim Shubber January 5, 2015

JD Wetherspoon has said it will serve Heineken's beers in its pubs again after the companies settled a dispute over pricing in Ireland. The pub chain, which runs almost 1,000 pubs in the UK and is starting to expand in Ireland, said in December it would not stock the Dutch drinks company's products after it accused Heineken of refusing to supply certain beers to a new pub in Ireland. The dispute was Wetherspoon's second with a brewer in Ireland, where analysts say a fragmented pub industry means suppliers have considerable negotiating power. Although the company has just two pubs in the country, Wetherspoon's aggressive pricing, around 40 per cent lower than competitors in Ireland, has shaken up the market. Wetherspoon had accused Heineken of being "obstructive" and of refusing to supply Heineken lager and Murphy's stout to its new pub in a port town south of Dublin. At the time, analysts suggested Wetherspoon's pricing strategy might have irritated the Dutch company, whose Heineken lager is a premium product in Ireland. Wetherspoons' decision to pull Heineken's beers from its pubs sparked a series of high-level meetings between the pub chain and Heineken, which have a 35-year relationship thought to be worth £60m annually. An agreement is believed to have been reached shortly after Christmas and Wetherspoon said it had begun stocking Heineken's beers again over the weekend.

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Under the new agreement, Wetherspoon's pubs in Ireland will not sell either Heineken lager or Murphy's and instead will stock Beamish, Foster's and Symonds Cider. "They got a better deal on Foster's than they were getting previously, that seems to have been the compromise," said Simon Matthews, analyst at Goodbody's. Wetherspoon's cheap beers and food have forced publicans in Ireland to re-examine their own businesses, he added. "The slickness of their food offering has publicans worried. The majority of Irish pubs haven't woken up to the need to provide a better food offering," said Mr Matthews. Wetherspoon entered the Irish market with a pub in Dublin last July, followed by a second pub in Dun Laoghaire, which opened in December and was the focus of the dispute with Heineken. The chain is also opening a 100-room hotel in Dublin and has ambitions to open around 30 pubs in Ireland over the next five years as part of a £400m plan to roll out 200 pubs across the UK and Ireland. Heineken said it was happy with the resolution of "a difficult situation". It declined to comment on the financial impact of the dispute. Wetherspoon's pubs in Ireland do not serve Guinness after it failed to agree on pricing with Diageo, the UK-based drinks company. ------

Jamie Oliver: Sugar can destroy lives and should be taxed like tobacco The campaigning television chef says sugar is "the next tobacco" and it should be taxed because of its health risks Source: The Telegraph By Ben Farmer 03 Jan 2015

Sugary foods risk causing a public health crisis similar to smoking and should be taxed in the same way as tobacco, Jamie Oliver has said. The television chef said sugar was "definitely the next evil" and should be targeted because of the burden it was placing on the NHS. He said he agreed with France's decision to impose a tax on sugary drinks and believes Britain should follow.

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The 39-year-old campaigner also disclosed that he had found himself on the verge of burning out from exhaustion last year, while balancing his empire of restaurants and television career. His comments on the risks of sugar following warnings from health campaign groups that sugary diets are one of the main factors in increasing levels of obesity and type-2 diabetes. By some estimates, the average Briton consumes 238 teaspoons of sugar each week - often without knowing it because processed foods are so sweetened. A third of British children and two-thirds of British adults are classed as obese or overweight, while the number with diabetes has doubled in the past two decades. The two conditions are already estimated to cost Britain more than £5bn each year and that could rise tenfold by 2050. Mr Oliver told the Daily Mail: "Sugar's definitely the next evil. It's the next tobacco, without doubt, and that industry should be scared. And it should be taxed, just like tobacco and anything else that can, frankly, destroy lives." Jeremy Hunt, the Health Secretary, last year ruled out taxing sugar, though admitted more needed to be done to tackle childhood obesity. Mr Oliver said: "I'm not passionate about taxing, but when you look at the pot of cash that isn't getting any bigger, and if you think that 68 per cent of every case that goes through the NHS is diet-related, then yes, you need radical change.' The chef also revealed how he had been forced to overhaul his lifestyle because overwork had left him exhausted and struggling to survive on three-and-a-half hours sleep each night. He said: "It's not as if I felt bad at the time. Or I didn't think I felt bad, but with hindsight I didn't look great. I didn't feel . alive. I was functioning, don't get me wrong, but looking back there was this feeling that I had to rev up to do it. I was exhausted all the time - and no wonder.' He said: "When I wasn't at work I could fall asleep at a minute's notice - not that I got the chance with the kids. At the weekend they want to play." Mr Oliver, who runs a string of restaurants across the country, also criticised EU regulations limiting working hours for employees.

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He said: "What's a 48-hour week in a kitchen? I mean, really, that's called a holiday. The average was 80 hours when I started and to people running their own places, that's probably still standard." ------

Tito Responds (Excerpt) Source: Lehrman Beverage Law by Robert C. Lehrman January 4, 2015

Over the years many have suggested that Tito's vodka is not really made in small batches or by hand. I tried to keep an open mind, as the brand grew, and even in the face of the lawsuits summarized here. http://www.bevlaw.com/bevlog/vodka/tito-responds ------

See This Guy Get Through a DUI Checkpoint Without Saying a Word - Thanks to What He Hung Out His Car Window Source: The Blaze Zach Nobl Jan. 3, 2015

When it comes to DUI checkpoints, 2013 and 2014 were both years of belligerent Constitutional confrontations. Could 2015 be the year those confrontations cool off - thanks to plastic bags hanging out of car windows? In a video posted to YouTube Thursday, longtime police recording activist Jeff Gray tests out a novel approach to DUI checkpoints in Florida: putting license, registration and insurance information in a plastic freezer bag, along with a Fair DUI message: I remain silent No searches I want my lawyer Attached to the inside of the car with a string, the bag is meant to keep a driver from having to roll down their window at a DUI checkpoint and, as Gray put it, put themselves in danger of having police "lie" and say their speech is slurred or that the smell of alcohol or drugs is wafting from the vehicle.

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How did police handle the bag trick? Very smoothly. While there were more than a few confused or amused glances from cops reading Gray's information. .the whole arrangement was apparently kosher by Florida standards, and police quickly waved Gray on his way - all while Gray refused to say a word. On Reddit on Saturday morning, commenters had wildly varied reactions to the video. "Do [the video makers] want more drunk drivers on the road or do they want to protect drunk drivers from prosecution?" one asked. "As a Canadian, I don't quite understand the thinking, as drunk driving is the number one cause of criminal death and you would think that you'd be happy that the police are trying to catch them before they can kill someone." Several other commenters said they didn't mind submitting to roadside testing, with one writing, "I wouldn't mind getting breathalyzed if it meant that a potential fatal crash stops from happening." Others, however, maintained that the video showed an exercise of basic rights - rights that are deeply important. "Those who are willing to give up freedoms for a little bit of temporary safety deserve neither freedom nor safety," one commenter wrote. http://www.theblaze.com/stories/2015/01/03/see-this-guy-get-through-a-dui-checkpoint-without-saying-a-word-thanks-to-what-he-hung-out-his-car-window/ ------

Cachaça 51 family die in helicopter crash Source: The Spirits Business by Amy Hopkins 5th January, 2015

Three members of the founding family of Companhia Müller de Bebidas, producer of the world's best-selling cachaça brand Cachaça 51, have been killed in a helicopter crash. Marcelo Muller, 33, the grandson of the founder of Companhia Müller de Bebidas, his wife Lumara Rocha Passos Muller, 31, and their two-year-old daughter Georgia, died in the crash outside of São Paulo, reports CRI English.

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Georgia's nanny and the pilot of the helicopter were also killed when the vehicle went down near the city of Bertioga. It is thought the helicopter was travelling to a hospital in São Paulo. Sources claim it is not yet clear what caused the accident, while an official comment from Companhia Müller de Bebidas is expected shortly. Cachaça 51, or Pirassununga 51, sold 17.6 million cases in 2013, making it the world's best-selling cachaça brand. ------

Nikka Whisky pioneer Takeshi Taketsuru dies Source: The Spirits Business by Amy Hopkins 5th January, 2015

Japanese whisky pioneer Takeshi Taketsuru, son of Nikka Whisky founder Masataka Taketsuru, has died at the age of 90. Taketsuru was adopted by his uncle Masataka and his Scottish wife Rita after an atomic bomb hit Hiroshima, situated near to his home town of Fukuyama, during the Second World War. He then worked for most of his life at Nikka Whisky Distilling, which he expanded substantially following the deaths of his adoptive parents. His pioneering role in the Japanese whisky sector has helped lead to its momentous growth across the world. Taketsuru's adoptive father is largely thought of as the father of Japan's whisky industry. He travelled to Scotland to study Scotch whisky distillation methods, where he met his future wife Rita Cowan, who is also credited with pioneering the whisky industry in Japan. Masataka Taketsuru helped establish a whisky distillery with Kotobukiya, which would later become Suntory, then went on to found his own distilling company, Dai Nippon Kaju K.K. (later renamed Nikka), in 1934. Takeshi Taketsuru became master blender at Nikka and endeavoured to maintain traditional techniques. He was appointed president in 1985 and remained advisor to the company until his death. Due to the boom in demand for Japanese whisky around the world, the Financial Times reports that Nikka's forecast sales for 2014 have increased to 100,000 cases, from 1,800 in 2006.

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Born in 1924, Takeshi Taketsuru died in 17 December 2014. He is survived by his son Kotaro and daughter Minobu. Just last month, it was revealed that a new television series charting the lives of Masataka Taketsuru and Rita Cowan had boosted the sales of Nikka Whisky in its domestic market. ------

John A. Pedroncelli, May 2, 1925 - January 4, 2015 Source: WineBusiness.com by Pedroncelli Winery 01/06/15

Born in Dunsmuir, California to Giovanni and Julia (Petrelli) Pedroncelli. 165 consecutive vintages at Pedroncelli gives John Pedroncelli the unofficial title as Dry Creek Valley's most experienced winemaker. His unsurpassed understanding of the region and its grapes provided him with an uncanny ability to bring out the best of both in his wines. Over the course of his career John lent an ear and gave direction to countless neighbors and newcomers to the Sonoma County grape scene. His love of the area, keen sense of micro-climates, soil quality and varietal compatibility have been a vital source for generations of grape growers and winemakers alike. John was two years old when the Pedroncelli family purchased the winery and moved to Geyserville in 1927. Growing up among the vineyards, he worked side by side with his father learning the business from the ground up. After two years of military service as a radarman in the Coast Guard, he entered Santa Rosa Junior College, where he studied chemistry and botany. He assumed winemaking responsibilities from his father in 1948, and returned to college in the early 1950s to take enology courses at the University of California at Davis. After the retirement of his father Giovanni (John) Pedroncelli in 1963, he also became manager of the family's vineyards, expanding them to 105 acres. During his tenure, John guided Pedroncelli through the tough transition from bulk wine producer to premium winery. He created California's first Zinfandel Rose in the mid-1950s, added more premium varietal wines in the mid-1960s, and updated the winemaking facility. John's innovative spirit and eye toward vineyard designate and site specific planting and trellising guided the company seamlessly into the 21st century. His winemaking team includes Vineyard Manager Lance Blakeley, Associate winemaker Montse Reece and Cellarmaster Polo Cano who worked closely with him over the years and learned the essence of John's style and passion. In addition to John's love for wine, his time in the Coast Guard gave him a desire for travel. Having visited most of the great winemaking regions, he and his wife Christine also travelled to many more of the world's great destinations. An avid outdoorsman, he was

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quick to identify a mushroom while walking the hills with one of his many canine companions; hunting and fishing rounded out John's great love of the world around him. John is survived by his wife of 48 years, Christine, children Connie (John) Proctor, Richard Morehouse, Maureen Davison, and grandchildren Roseann, Lauren, Christopher, Ian and Elea. Also brother James (Phyllis) Pedroncelli and numerous nieces, nephews and cousins. He was predeceased by sisters Margaret (Al) Pedroni and Marianne Pedroncelli. A private funeral service will be held. ------

Wine Industry Mourns Passing of Arthur "Jay" Fritz, Jr. Source: WineBusiness.com Date: 12/23/14

Upon his retirement as Chairman from Fritz Companies in 1998, Jay was able to focus full-time on Fritz Cellars, the Sonoma County winery he founded in 1979 Cloverdale, CA (January 3, 2014) - The wine community is mourning the passing of an innovative leader and one of the industry's true visionaries. Arthur "Jay" Fritz, Jr., founder of Fritz Underground Winery, passed away on December 30, 2014 at the age of 74 after a long illness. Jay, as he was known to family and friends, was born in 1940 to Arthur Joseph and Emily Sue Fritz, the oldest of three children including brother, Lynn, and sister, Sandra Davis. A life-long San Francisco resident, Jay graduated from St. Vincent De Paul Grammar School, St. Ignatius High School, Dartmouth College (cum laude) and Stanford Law School. Upon his retirement as Chairman from Fritz Companies in 1998, Jay was able to focus full-time on Fritz Cellars, the Sonoma County winery he founded in 1979. From humble beginnings knocking on the doors of local restaurants, Jay found success again, building Fritz Cellars into a thriving, award-winning business selling over 25,000 cases annually. In 2001, Jay turned the reins over to his son Clayton, who continues to make wine under the Fritz Underground Winery label. "My father instilled in me the same vision that led him to start Fritz Underground Winery - a viticultural passion based on a respect for the environment, excellence and hard work," said Clayton Fritz. "He was a man of great wisdom and accomplishment, with a deep and abiding love for his family, friends and community. He will be missed by all who knew him." Jay's vision for a winery grounded in responsible stewardship is what allowed the quality of the natural bounty of the 120+ Estate to thrive over the past thirty years. With a natural

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spring to supply simple irrigation, redwood groves to provide unique micro-climates, and a soil ideal for prized planting year after year, the Fritz terroir provides for a caliber of wine unrivaled. It was Jay Fritz's fidelity to sustainability and quality that ultimately made the Fritz Underground Winery what it is today. The sense of loss will extend well beyond the wine community. He was a member of the Board of Regents at his alma mater St. Ignatius and contributed service time as a member of the Knights of Malta, Stewards of St. Peter, Legatus, Daughters of Charity Advisory Board, Cathedral School for Boys Board of Trustees and Santa Catalina School Board of Trustees. In 1995, he and his wife founded the Barbara and Jay Fritz Charitable Foundation which supports numerous worthy organizations with an emphasis on helping children in need. A devoted husband and father, Jay is survived by wife Barbara Frances Carr; three children: Arthur (Tri), Clayton and Jenner; and seven grandchildren: Ainsley, Buchannon, Sarah, Audrey, Bianca, Georgia and Leonardo. Friends and relatives are invited to St. Dominic's Church, 2390 Bush St. in San Francisco, on Tuesday, January 6th at 6:30 p.m. for a Viewing followed by a Rosary Vigil, and on Wednesday, January 7th at 11:30 a.m. for a Funeral Mass with reception to follow; Fritz Underground Winery will be closed on January 7th in remembrance. In lieu of flowers, donations can be made to "Mission Dolores Academy Scholarship Fund," 3371 16th Street, San Francisco, CA 94114. www.halstedngray.com ------

Volker Eisele, Napa winemaker who led fight for farmland protection, dies at 77 (Excerpt) Source: THE PRESS DEMOCRAT BY DEREK MOORE January 2, 2015

Volker Eisele, the outspoken architect of a landmark farmland protection policy in Napa County that became widely emulated as a model for staunching unwanted development, died Friday at his ranch home near St. Helena from complications related to a stroke. He was 77. The German-born Eisele was an organic wine grape grower before the concept was popular. As a community activist and leader in the agricultural industry he fearlessly took on established orthodoxy, often in blunt style. He will be remembered most for engineering Measure J, a controversial land use policy that was enacted by voters in 1990 over heavy opposition from pro-development forces.

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Under Measure J, agricultural lands in Napa County cannot be converted to other uses without voter approval. The measure survived numerous legal challenges, including one before the state Supreme Court. In 2008, it was extended by voters through 2058. "Volker Eisele was largely responsible for Napa's foresight in protecting our agricultural community," North Coast Congressman Mike Thompson, D-St. Helena, said Friday. "With his understanding of, and dedication to, land use policy, he leaves a lasting legacy for future generations to follow. Volker made great wine and was an even better friend that will be missed." http://www.pressdemocrat.com/home/3325937-181/volker-eisele-napa-winemaker-who ------

The most important things happened in the wine business of China in 2014 Source: Wines-info.com January 5, 2015

Wines-info.com recaps the important things happened in the wine business of China in 2014 http://en.wines-info.com/html/2015/1/189-59923.html ------

A Spectacular Year For Zachys Wine Auctions In 2014 Source: Zachy's January 5, 2015

Zachys' 2014 Year In Review is now available for select press. In addition to providing details about our successes in 2014, get an inside look on overall trends in our business with an in-depth analysis of our US and Hong Kong live sales as well as our monthly internet auctions. http://click.icptrack.com/icp/relay.php?r=40611422&msgid=339052&act=SCKW&c=1143127&destination=http%3A%2F%2Fwww.zachys.com%2Fuploadedimages%2Fdownloads%2F2014_YIR.pdf ------

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SOUTHERN WINE & SPIRITS OF AMERICA IS FOUNDING SPONSOR OF WOMEN OF THE VINE COMPANY TAKES LEAD IN CULTIVATING WOMEN LEADERS IN THE WINE INDUSTRY Source: SWS January 5, 2015

Mel Dick, President of the Wine Division, and Senior Vice President of Southern Wine & Spirits of America, Inc. (Southern)-the nation's leading wine and spirits distributor with operations in 35 states-announced today the company's commitment and sponsorship of Women of the Vine. Southern is the Founding Sponsor of the organization and its first annual Women of the Vine Global Symposium-dedicated to the contribution of women across all sectors of the wine industry and across the globe to connect, network, mentor, collaborate and provide tangible strategies to create opportunities within the dynamic world of wine. As the Founding Sponsor, Southern has committed to the Women of the Vine organization, the symposium and its mission in perpetuity. "At Southern, we're honored to take the lead in sponsoring this groundbreaking organization and event in the wine world. As leaders in the wine and spirits industry, we are committed to growing diverse leadership teams and investing in talent development throughout the company," commented Dick. The first annual Women of the Vine Global Symposium will be held March 13-15, 2015 in Napa, California. Deborah Brenner, founder of Women of the Vine, added, "We're elated to welcome Southern Wine & Spirits onboard as the Founding Sponsor of this first of its kind conference. As the leading wine and spirits distributor in the U.S., Southern's sponsorship signals their commitment to their employees, future talent and the industry as a whole." Expounding on Southern's sponsorship and commitment, Steve Slater, Executive Vice President, General Manager of the Wine Division, added, "It truly is an honor to provide our ongoing support to the organization. In addition to the symposium, Southern is also the Founding Sponsor of the Women of the Vine Tuition Assistance Program. We are proud to be a part of this group that is dedicated to celebrating the achievements and advancement of women in the business." For the Women of the Vine Tuition Assistance Program, grants of $500 - $2,000 will be awarded to those qualified and seeking to pursue their education in the wine industry. The Women of the Vine Global Symposium is guided by an advisory board comprised of notable industry professionals across many sectors of the wine world. Southern's Mel Dick, Steve Slater and Nicole Bazzo, Trade Development/Portfolio Manager with the Southern California Division will join the 19-member advisory board.

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Here's the skinny on low-calorie wines Source: Fortune by John Kell January 3, 2015

Looking to cut calories in 2015? Low-cal wines could help. Brancott Estate's low-calorie wine, Flight Song, has been on liquor shelves, courting calorie counters, for less than a year. It took more than 10 years to get it there. The New Zealand wine producer spent almost a decade researching how to best make low-calorie wine. Another three years went into harvesting and testing the varieties in the vineyard. The wine, which is 20% lighter in calories than standard, is part of a growing trend to market low-calorie wines to a mostly female, Millennial crowd. Rival brands include Treasury Wine Estates' The Skinny Vine, and reality TV star Bethenny Frankel's Skinnygirl line, which is owned by liquor giant Beam Suntory. U.S. wine consumption has increased steadily over the past two decades, but there's no clear sense of just how large the low-calorie market is, or if low-cal wines have contributed to the industry's broader growth. Observers agree, though, that it's a niche market for now, and makes up a tiny sliver of the overall U.S. wine market. Low-cal wines have no set industry standard, although experts say they are at least 15% lighter than the standard 120-130 calories found in a typical five-ounce serving. Generally speaking, U.S. wines have growing conditions that are less favorable to the low-cal craze. California, the nation's principal source of grapes, has more heat and less rain than many wine-growing regions in Europe and therefore the wine it producers is higher in sugar and thus higher in calories. Nevertheless, several U.S. companies are still trying while some, like Brancott, are importing wines made abroad in more favorable regions. Skinnygirl, which began selling wines about three years ago, this month debuted a pinot noir. The Skinny Vine has been on shelves about two years, while FlightSong will celebrate its first-year anniversary in February. "If I could have some lower alcohol wines instead of a 17% [ABV] zinfandel, it would be preferable for someone like me," said Rob McMillan, the founder of Silicon Valley Bank, which lends to wineries. McMillan said low-calorie wines aren't a popular category in the U.S. quite yet, but there's potential. "I can't drink like I did when I was 30," the 58-year-old said.

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Matt Foley, brand director at Pernod Ricard's Brancott Estate, believes there have been two major barriers that have held the wine industry back from tapping the low-calorie space: social stigma and quality concerns. "When you talk to the consumer, taste is a big barrier," Foley said. "They are concerned they can't get a quality low-calorie wine." A bottle of Flight Song wine.Courtesy of Pernod Ricard Low-calorie wines have a lighter alcohol content, which can be achieved by harvesting grapes a few weeks earlier than normal. But by pulling grapes ahead of schedule, the ripened fruit miss out on some key aromatic and flavor compounds that come together late in the maturation process. Not everyone in the industry is sold on the concept of low-calorie wine. Some detractors point out that a caloric reduction of about 20 calories per serving might not be worth it. "Low calorie [wine] is something that people can be curious about, but if you are really concerned about your health, I don't think you should be focused on Skinnygirl," said Ryan O'Connell, a California winemaker and marketing manager for NakedWines.com. "The better way to go about it is to make sure what you are drinking is good wine, and if that means drinking a little less, and higher quality, I think you'll do yourself a much greater service." At NakedWines.com, a crowdfunding platform that connects independent wine makers to investors, less than 10% of the portfolio can be considered a low-calorie wine. And those lighter wines aren't marketed that way, O'Connell said. Some wine styles, such as French wines, naturally have fewer calories than the standard glass. "We have lower alcohol wines that are dry and are low-calorie, but we don't make a big deal about it," O'Connell said. The teams behind Skinnygirl and Brancott Estate say they believe there's a market for their wines, generally courting women in their 20s to late 30s. Megan Frank, senior director at Beam Suntory, said there are a few challenges. In particular, when consumers first learn about low-calorie wines, they are initial skeptical about the taste. "The biggest learning lesson for us was to make sure our communication and marketing plans let them know that they didn't need to sacrifice taste," Frank said. One way Beam Suntory tackled that was with in-store tastings. Some experts say that the wine industry's experimentation with lower-calorie wines mirrors what's going on in the craft beer world. "Session beers" are a category that's emerged and is basically any beer that contains no higher than 5% ABV. Those beers

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hope to pack the flavor that's associated with craft beer, but with lower alcohol content and thus fewer calories. "There had been a move toward big, concentrated wines," said Kurt Lorenzi, vice president of global sourcing at wine and beer supplier Winery Exchange. "And now there's a lot more interest in wines that are better balanced, and part of that is lower alcohol, and with it, lower calories." ------

Rite Aid sales surge 5.3% Source: RT By Gina Acosta January 5, 2015

Rite Aid Corp. says sales at stores open at least a year grew 5.3% in December, boosted again by strengthening pharmacy sales. Same-store sales at the Camp Hill, Pa.-based retailer grew 5.3% to $2.2. billion, beating analyst consensus of 4.5% and reflecting a 1.7% increase in front-end same-store sales and a 7.3% increase in pharmacy same-store sales. "The front-end comp of 1.7% outpaced consensus of 1.2% and represents the strongest two-year trend since last January," noted Ed Kelly, Credit Suisse research analyst. "Flu-related OTC helped and Wellness remodels are likely a tailwind whose impact could ramp over time as a higher proportion of the store base is remodeled. The pharmacy comp beat as well, as sales rose 7.3% vs. consensus of 6.3%, although generic impact markedly decelerated sequentially due to the lapping of Cymbalta." Prescription count at comparable stores increased 5.1% over the prior-year period. Prescription sales accounted for 64.8% of drug store sales, and third party prescription sales represented 97.6% of pharmacy sales. Same-store sales for the 43-week period ended Dec. 27, 2014 increased 4.3% over the prior-year period. Front-end same-store sales increased 1% while pharmacy same-store sales increased 5.9%. Prescription count at comparable stores increased 3.6% over the prior-year period. Total drug store sales for the 43 weeks period increased 3.9% with sales of $21.8 billion. Prescription sales represented 68.6% of total drug store sales, and third party prescription sales represented 97.5% of pharmacy sales. ------

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Family Dollar Investors Can't Fight Ruling On Buyout Vote Source: Law360 By Jamie Santo January 02, 2015

A Delaware Chancery judge on Monday rebuffed an effort by Family Dollar Stores Inc. investors seeking to challenge his decision to let shareholders vote on an $8.5 billion buyout offer from fellow discount retailer Dollar Tree Inc., finding there were no grounds to bless an interlocutory appeal. Chancellor Andre G. Bouchard, who last month rejected a call to enjoin Family Dollar's planned shareholders meeting until company directors engaged with spurned suitor Dollar General Corp., denied the suing investors' request to reargue the ruling before the Delaware Supreme Court. The investors' application for an interlocutory appeal to state's high court "fails to satisfy any of the requirements for certification" under Delaware law, the chancellor wrote in an eight-page opinion. Family Dollar's board approved the $8.5 billion Dollar Tree merger agreement in July, and subsequently spurned higher bids from Dollar General out of concerns that such a deal would not receive regulatory approval. On Dec. 19, Chancellor Bouchard declined to issue a preliminary injunction that would have held up the slated Dec. 23 special shareholders meeting, finding the suing shareholders were unlikely to prevail on their main claim that Family Dollar's directors breached their fiduciary duty by refusing to enter discussions with Dollar General. Family Dollar announced Dec. 23 that the shareholder vote on the Dollar Tree deal had been rescheduled for Jan. 22, saying not enough votes had been cast, and suing investors lodged their appeal application Dec. 24. In rejecting the request for certification, Chancellor Bouchard said his earlier opinion had not decided an original question of law regarding the duties required of Delaware directors under the landmark 1986 Revlon decision. "Rather, as members of this court have done for nearly 30 years since Revlon was decided, the [Dec. 19] opinion simply applied well-established legal principles emanating from Revlon to a particular set of facts," Chancellor Bouchard said. The chancellor reiterated Friday that Family Dollar directors were motivated to maximize value, were advised that Dollar General's $9.1 billion offer had only a 40 percent chance of winning regulatory approval, and had used reasonable judgment in determining it wasn't prudent to open discussions because that suitor's pledge to divest up to 1,500 stores fell far short of what it would take to address those concerns.

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Moreover, Chancellor Bouchard said his December determination that a board considering a superior third-party offer needs to be "adequately" informed rather than "fully" informed does not conflict with the Chancery Court's 2013 Koehler v. NetSpend Holdings Inc. decision. "In my view, this argument is one of semantics as there is no genuine conflict between the [Dec. 19] opinion and NetSpend in their respective analyses of a Delaware director's obligation to be informed when making a decision in the context of fulfilling one's obligations under Revlon," the chancellor said. The investors' argument that appellate review of the December opinion appropriate because the opinion involves substantial issues and would serve considerations of justice is also insufficient reason for certification, the chancellor said, because Delaware law requires a showing that the trial court reversed or set aside a previous decsion. Family Dollar announced in July that its board had approved a buyout offer from Dollar Tree that promised investors consideration of $74.50 per share. Dollar General took its case directly to the investors in September, launching a tender offer to buy all Family Dollar's stock at the sweetened price of $80 per share, and said last month it was still in talks with the Federal Trade Commission to resolve antitrust concerns tied to its hostile bid. The suing shareholders are represented by Levi & Korsinsky LLP, Milberg LLP, Andrews & Springer LLC and Rigrodsky & Long PA. Family Dollar and its directors are represented in the Chancery case by Cleary Gottlieb Steen & Hamilton LLP and Morris Nichols Arsht & Tunnell LLP. The case is In re: Family Dollar Stores Inc. Stockholder Litigation, case number 9985, in the Court of Chancery of the State of Delaware. ------

Tesco, Sainsbury's and Marks & Spencer to report Christmas sales slump Three of Britain's biggest retailers to reveal tough Christmas trading, as Tesco looks to fund fightback by cutting costs and selling assets Source: The Telegraph By Graham Ruddick 03 Jan 2015

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Three of Britain's biggest retailers will unveil a slump in Christmas sales this week, laying bare the pressure on the grocery industry and the high street. Tesco, Sainsbury's and Marks & Spencer are all expected to report sluggish festive figures, with the supermarkets suffering from falling food sales and M&S struggling to turn around its clothing business. The scale of the sales slump for supermarkets will be unprecedented in recent times, with Morrisons and Asda also likely to have suffered a fall in sales. The trading update from Tesco, scheduled for Thursday, will be particularly significant because new boss Dave Lewis will lay out plans to cut hundreds of millions of pounds of costs and sell off assets. The money raised from these initiatives will help Tesco to shore up its balance sheet and fund price cuts in its stores. Mr Lewis, nicknamed Drastic Dave for his restructuring of Unilever's UK business, is expected to put thousands of jobs at risk by shrinking Tesco's 23 offices around the UK. He may also confirm that Tesco will sell off its online streaming business Blinkbox, as well as other assets. Sources have indicated that Mr Lewis and his finance director Alan Stewart are considering selling a stake in Tesco Bank, as previously reported by The Telegraph, as well as a multi-billion pound IPO of the company's Asian operations and disposing of part or all of Dunnhumby, the analysis tool behind Clubcard. It is understood a final decision has yet to be taken on disposals and company sources suggested that Tesco's statement will represent an update on Mr Lewis's thinking, rather than a blueprint for the company's future. Clive Black, analyst at Shore Capital, said the prospect of a rights issue, which had previously been ruled out by Tesco, was "now closer to 50-50" after a profit warning in December, the company's fourth of the year. Mr Black said he expected Tesco to unveil a "focus on simplification" and a "material contraction of head office". He added: "I would be surprised if there is not a cut in capital expenditure. I don't see how you can justify spending £2.1bn a year." Tesco is also battling a pension deficit of £3.4bn and is on the brink of having its credit rating downgraded to junk status. Mr Black said Christmas had been a "slog" for Britain's supermarket operators. "Five or six years ago people queued to get into superstore car parks. Those days are gone. For some people they are a glorified top-up shop." Analysts at Deutsche Bank, Tesco's house broker, have forecast that the company will report a 5pc drop in like-for-like sales for the quarter to the end of November and then a fall of 4.3pc for the period since then, including Christmas. This would be an improvement

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on the 5.4pc fall in sales in Tesco's last quarter, but still underlines the battle facing Mr Lewis. Mr Black has forecast that Tesco could fare slightly better, predicting a drop in like-for-like sales of between 2pc and 2.5pc for the Christmas period. This performance would be in line with the predicted performance of Tesco's great rival Sainsbury's, which is expected to post a decline in like-for-like sales of 1.8pc, according to analysts at Bernstein. Marks & Spencer, which updates on trading on the same day as Tesco, is likely to have outperformed its rivals in the food market, thanks to its focus on upmarket fare, which is popular during holiday seasons and events. M&S enjoyed a 0.9pc rise in like-for-like food sales during the Christmas period, according to a consensus of eight analysts. However, the performance of M&S will be dragged down by its clothing business, heaping the pressure on chief executive Marc Bolland. Analysts have forecast that like-for-like sales in the company's general merchandise arm will be down 3pc over the last quarter, meaning that M&S will have reported 14 consecutive quarters of falling non-food sales. ------

Minnesota: A tougher landscape for municipal liquor stores Source: Star Tribune SUSAN FEYDER January 4, 2015 Hours before midnight on New Year's Eve, the sales floor at Edina's 50th Street municipal liquor store was still humming. As customers roamed the aisles and lined up at the checkout counter, a promotional message played over the public address system, ending with the tagline - "Where Profits Get Poured Back into the Community." The slogan is part of a new marketing campaign noting that Edina's three liquor stores help fund everything from the city's art center to road repair. It's a message Edina and other municipal operators are emphasizing with shoppers who might otherwise buy from the area's growing field of national and big-box chains. Across the Twin Cities, municipal liquor stores are closing the books on a challenging year in 2014, knowing that 2015 may be an even bigger test of their ability to hold their own. The latest challenge comes from national superstore Total Wine & More, which entered the Twin Cities last year and now has four outlets, with plans for more. Total Wine superstores typically offer 8,000 wines, 3,000 spirits and 2,500 beers - a much larger selection than municipal stores - and heavily promote discount prices. Executives of

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the Maryland-based chain have said they believe the Twin Cities has been an underserved market. "We're a destination store, not a convenience store," said Edward Cooper, vice president of public affairs and community relations. He said Total Wine stores tend to draw customers from a 10-plus-mile radius. Savage's liquor store on County Road 42 has been hit with "a double whammy," according to City Administrator Barry Stock - the closing of a neighboring Rainbow Foods that drew customers to the liquor store and the opening of a Total Wine about 5 miles away in Burnsville. Stock says the city is trimming expenses, like filling a vacant store manager position with an assistant manager at lower pay. Even before the arrival of Total Wine, city-owned liquor stores have found themselves under pressure. Twelve of 19 metro area municipal liquor operations saw their profits drop in 2013, according to the latest report from the state auditor. The stores' overall contribution to city coffers also fell, from about $8.3 million in 2012 to less than $7 million in 2013. The infusions help cities pay for equipment and facilities instead of doing without or finding other ways to pay for them, like raising property taxes. Municipal liquor stores enjoy monopolies within their own city borders but can feel the impact from a Total Wine, MGM, Trader Joe's or Costco in a neighboring city. "Ground zero would be a good way to describe where we are," said Mike Larson, who oversees St. Anthony's two municipal stores - each about 5 miles from a Total Wine that opened last March in Roseville. Other new liquor stores in New Brighton and northeast Minneapolis also have amped up the competition. "We have felt the saturation of this market," he said. "If any city near a Total Wine has increased their sales, good for them," said Steve Grausam, Edina's director of liquor operations. He said the city's Southdale liquor store has seen its weekly sales fall by 10 to 15 percent since November, when a Total Wine opened 2 miles away in Bloomington. "It's natural for people to check out a new store. We think things will eventually level out," he said. Poised to compete City-owned liquor operators say they're responding by sharpening their business practices. Besides emphasizing funds they provide for parks, snowplows and police stations, municipal operators are remodeling outdated stores and bulking up on locally made merchandise from microbreweries, microdistilleries and boutique wineries. And some, like Lakeville, are borrowing a page from Total Wine's playbook and beginning to sell some of the same private-label merchandise the superstore touts.

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"They're no marketing dummies," said Brenda Visnovec, director of liquor operations in Lakeville, a neighbor of the Burnsville Total Wine. The superstore chain sells nationally known brands at or below cost, making much of its profit from markups on the private-label goods. In some parts of the country, it can sell those private labels exclusively, but in Minnesota, wholesalers are required to offer the same merchandise to every retailer. "We are simulating their game," Visnovec said. Besides offering some of the private-label products, Lakeville Liquor has created a list so customers can request them. Grausam said the $300,000 remodeling of Edina's 50th Street store may be one reason that location has held its own against Total Wine. The same is true in Fridley, which recently finished renovating its store near Interstate 694 and University Avenue. Fridley Finance Director Darin Nelson said the store had its strongest November sales ever after the remodel, which was completed in October. The Fridley store makeover included a rebranding campaign using the same marketing consultants who advised Edina. Besides going more upscale, like adding a tasting area, the decor includes oversized photos from Fridley's past to emphasize the store's community roots, Nelson said. Local products popular In Richfield, sales at its 50-year-old outlet at Lyndale Avenue S. and 65th Street also shot up after an ambitious makeover in 2013, according to Bill Fillmore, director of liquor operations. Fillmore said housing and commercial development near the Lyndale store, including a new apartment complex, also has bolstered the shop's business. "A couple of years ago there was no reason that people would want to go there. Now people are attracted to the area," he said. Richfield also conducted an extensive customer survey around the time it was remodeling the store. "The products that weren't paying the rent - out they went," Fillmore said. All stores now carry an expanded selection of products from local microbreweries and microdistilleries, many of which have sprouted recently in the suburbs. Fillmore notes the small-batch products can sometimes be difficult to obtain, but they tend to carry higher profit margins. "They add excitement to the business" said Fillmore, who recently filled a customer's request for a new vodka produced by J. Carver Distillery, a start-up in Waconia. "People ask for and wait for these products to come out."