Financial Statement Analysis
EXECUTIVE SUMMARY
The Boston Beer Company operates on the sale of beer in the beer industry. The company’s financial statements from 2007 to 2011, has served for an analysis of company’s success in asset utilization, solvency, profitability, and liquidity. The company has demonstrated strong financial qualities pertaining to its solvency and profitability. Because Boston Beer Co. has no debt; the likelihood of them meeting expansion and growth goals is high. Consistency in incremental increases throughout the years relevant to profits leads to the long-term profitably the company. Asset utilization in the company and liquidity of the company do not demonstrate dramatic change for the better, neither dramatic change for the worse. The company started a program with wholesalers in 2010, which contributed to the increase in inventory held on hand. The program aims to reduce the time inventory is at the wholesalers warehouse, therefore increasing the time inventory is at Boston Beer Co.’s warehouse. The company’s cash conversion cycle stands out as the biggest weakness to the company by increasing in days each year. Although the company displays a decrease in liquidity, they are in a good financial state to meet obligations of future cash needs.
Small increases and decreases through the course of five years are due to management’s adjustments resulting from arrangement of new programs, change in supplier requests, and Boston Beer Co.’s ability to prevent debt.
COMPANY OVERVIEW
The Boston Beer Company started in 1984 and as of 2011 is the largest American-owned brewer. Although primarily know for its Samuel Adams beer, the company produces a variety of beer year around including seasonal selections. The company’s profits are mostly from the sale of its own barrels of beer as well as production and packaging for 3rd parties. Major competitors in the beer industry are AB InBev, MillerCoors LLC, Heineken and Corona. The Boston Beer
The Boston Beer Company operates on the sale of beer in the beer industry. The company’s financial statements from 2007 to 2011, has served for an analysis of company’s success in asset utilization, solvency, profitability, and liquidity. The company has demonstrated strong financial qualities pertaining to its solvency and profitability. Because Boston Beer Co. has no debt; the likelihood of them meeting expansion and growth goals is high. Consistency in incremental increases throughout the years relevant to profits leads to the long-term profitably the company. Asset utilization in the company and liquidity of the company do not demonstrate dramatic change for the better, neither dramatic change for the worse. The company started a program with wholesalers in 2010, which contributed to the increase in inventory held on hand. The program aims to reduce the time inventory is at the wholesalers warehouse, therefore increasing the time inventory is at Boston Beer Co.’s warehouse. The company’s cash conversion cycle stands out as the biggest weakness to the company by increasing in days each year. Although the company displays a decrease in liquidity, they are in a good financial state to meet obligations of future cash needs.
Small increases and decreases through the course of five years are due to management’s adjustments resulting from arrangement of new programs, change in supplier requests, and Boston Beer Co.’s ability to prevent debt.
COMPANY OVERVIEW
The Boston Beer Company started in 1984 and as of 2011 is the largest American-owned brewer. Although primarily know for its Samuel Adams beer, the company produces a variety of beer year around including seasonal selections. The company’s profits are mostly from the sale of its own barrels of beer as well as production and packaging for 3rd parties. Major competitors in the beer industry are AB InBev, MillerCoors LLC, Heineken and Corona. The Boston Beer