2007 Malt Beverage Industry Packaging Trends Craft Brewers Conference San Diego, CA April, 19, 2008 Lester Jones Beer Institute Washington, DC

2007 Changing Marketplace Import sector pulled back to its slowest growth in past 10 years, Slowing occurred in the mainstream import brands, but still have strong demand for specialty beer from smaller importing countries such as Belgium. Top 3 Brewers had a very interesting year…  AB first full year with Inbev, Grolsch, and Rolling Rock in their distribution network  MBCO has successful Miller Chill product launch and McKenzie River/Steele Reserve continue to grow  Molson-Coors had continued success with Blue Moon, Coors Light Cold Campaign and Coors Original Banquet Boston Beer continues posting strong growth Yuengling continues to post a moderate growth and expands into TN. Specialty/Craft segment continues double digit growth from 2006 into 2007 with 12% growth. BIG QUESTION: Will the economic slowdown, rising ingredient costs and resource prices slow industry growth in 2008?

Per Capita Consumption of Malt Beverages 1980 to 2007 (gallons per person/total population) Source: Beer Institute, Second year of increase 22.2 in 2007 from a high of 24.6 in Changing Demographics, tastes and trading up 3.Increased alcohol beverage competition 4.Additional non-alcohol beverage choices 5.Policy Changes (21 LDA and.08)

Segment 2006 Volume 2007 Volume 2007 Share Volume Change Percent Change Domestic*180,401183,01986%2,6181.5% Imports29,29429,69514%4011.4% Total Industry209,695212,714100%3,0191.4% Total Malt Beverage Industry 2006 vs (1,000’s of 31 gallon barrels) Source: Beer Institute, 2007 Total Industry added over 3 million barrels or 42 million cases of beer for a gain of almost 1 billion 12 ounce equivalent servings. In a dramatic reversal from 2006, over 90% of the net gain in volume came from domestic growth. * 2007 Beer Institute Year End Reported Volume

Domestic Segment Share Volume Change Percent Change Packaged 163, , % 2,4881.5% Draught 16,993 17,2879.4% % Tax Determined * % 51.2% Total Industry * *180,778183,565100%2,7871.5% Domestic Malt Beverage Industry 2006 vs (1,000’s of 31 gallon barrels) Source: TTB and Beer Institute, 2008 * Tax Paid on beer that is served directly from serving tanks in brewpubs and tavern Small relative to total market but still 85 million 16 ounce servings. * * Industry totals may differ from year end published figures in previous slide as additional information on 2007 is collected in 2008

Import Package Mix 2006 vs (1,000’s of 31 gallon barrels) Package Type Share Volume Change Percent Change Bottles 23,130 22, % % Cans 3,971 4, % % Draft 2,194 2,4508.3% % Total29,29529,965100% % Cans and draught carried imported industry volumes for The bottle segment from Mexico and Netherlands lost over 700,000 combined barrels. Source: Us Dept of Commerce and Beer Institute, 2008

Imports of Draught Beer into the US 1999 to 2007 (31 gallon barrels) Source: US Dept of Commerce, Bureau of Census and Beer Institute, 2007 Draught imports have grown 7% CAGR since 1999 to reach 2.4 million barrels in Measure of on premise consumption and best opportunity for consumers to try new brands.

National Package Mix Trends, 2006 vs (1,000’s of 31 gallon barrels) Package Share Volume Change Percent Change Cans100,656103, %2,9622.9% Bottles88,19388, %770.1% Draught19,56420,1099.5%5452.8% Refills % % Plastic %202.8% Total209,746212, %2,9891.4% Source: Beer Institute, 2008 Industry totals may differ from year end published figures in previous slide as additional information on 2007 is collected in calendar year 2008.

US Package Mix Volumes, Source: Beer Institute Package Mix and Shipment Reports, 2008 Shares Pack Cans55%48% Bottles30%41.5% Draught 11% 9.5% Refills 4% 0%

Draught Beer Share – On Premise Measure Draught Share of Market 1946 to Draught share of market has fallen consistently from over a third of the market to less than 10% in But still significant, over 20 million barrels (domestic + imports) in 2007 for over 4.9 billion 16 ounce servings. 3.There are over 29,000 miles of draught lines in the US and over 10 million kegs in circulation. Source: TTB and Beer Institute, 2007

Making a Dent in Keg Theft

Price Index for Scrap Metals, Four fold increase since 2001 Source: BLS Producer Price Index and Beer Institute, 2008

Keg Loss Estimate 2006 volumes and values 2006 Volume EstimatesTotal Draught Volume Barrels19,253,609 Total Kegs (mixed sizes) 45,120,744 Keg Turn (industry average)4.2 Keg Float to handle volume 10,740,667 Percentage loss3.6% Kegs loss in ,053 Replacement Cost$136 Replacement Value$52,613, million kegs equals about $1.5 billion in brewer assets on the street 386K kegs have the potential to be worth $15 million at current scrap values Source: Beer Institute, 2007

Keg Loss Surprise Issue of the Year 300,000 Kegs Lost Costs Industry More than $50 million annually Expected to Get Worse Fighting Back ● Partnering with ISRI, Others ● Education materials ● Ad campaign in Scrap Magazine

PR February 8, 2008 Keg Loss/Scrap Metal Loss Prevention Efforts

Thank You Lester Jones Beer Institute Washington, DC