Shares of Boston Beer Company (SAM 2.44%) were up 16% as of 12:45 p.m. EDT Friday after the craft brewing specialist announced better-than-expected second-quarter 2017 results.
Quarterly revenue increased 1.3% year over year to $264.7 million and translated to 9.4% growth in net income to $29.1 million. Thanks to share repurchases over the past year, net income per diluted share rose 14.1% to $2.35. By comparison, investors were only expecting earnings of $1.41 per share on revenue of $247.9 million.
Digging deeper into Boston Beer's results, depletions -- a key measure for how quickly its products travel from warehouses to consumer outlets -- declined 3% year over year, but marked a significant sequential improvement from last quarter's painful 14% decline. Shipment volume was also flat on a year-over-year basis at roughly 1.1 million barrels.
"We are happy that our total Company depletion trends have significantly improved from earlier in the year," added Boston Beer founder and chairman, Jim Koch, continuing:
... but we remain challenged by the general softening of the craft beer and cider categories and a more competitive retail environment with a lot of options for our drinkers. We are working hard to return to growth through improving our messaging and innovation behind Samuel Adams and Angry Orchard.
In the meantime, Boston Beer now expects its full-year adjusted earnings per share to be in the range of $5.00 to $6.20, marking an $0.80-per-share increase to the lower end of Boston Beer's previous range.
All things considered, Boston Beer still has plenty of work to do. But this quarter was a huge step in the right direction, and it's no surprise to see shares rebounding in a big way as a result.