Brand Update 2018: Year in Review

BRAND UPDATE
6
PARTNERS PROPEL SALES TO NEW HEIGHTS
A worldwide beacon of quality, Certified Angus
Beef ® brand sales of 1.21 billion pounds
were recorded in Fiscal 2018. That’s the 12th
consecutive annual sales record, extending a
14-year streak of year-over-year growth and
the third year for sales above 1 billion pounds.
The 8.1% increase represents an additional 91
million pounds of high-quality beef raised by
quality-minded farmers and ranchers to meet
steadily growing consumer demand.
“For the past 40 years, a community of people
from farm to plate – each necessary to deliver
the Certified Angus Beef ® brand to dinner tables
around the world – have shared much: a
passion for excellence, a dedication to quality,
and ideas and inspirations to achieve our
goals,” said John Stika, the brand’s president.
“Along the way, we’ve built relationships on
trust and a shared vision. By doing so, what
started out as a simple idea among a small
group of cattlemen has become the world’s
leading brand of beef.”
The brand set sales records in all 12 months
of its 40th anniversary year, and seven of the
brand’s 10 highest sales months in history were
in 2018. More than 100 million pounds were
sold in the months of March, May, June, July,
August and September, with August being the
most successful month ever recorded.
True to its inception in 1978, a community
of farmers and ranchers remain the backbone
of the brand, committed to supplying
consumers with consistent and pleasurable
eating experiences. Their efforts to raise
quality cattle enabled licensed processors,
distributors, restaurateurs and retailers to
meet this growing demand for premium beef.
Responding to economic signals from the
consumer marketplace, cattlemen raised a
record 5.18 million cattle that met all of the
brand’s requirements last year – an increase
of 14.3% over 2017. Further, the rate of cattle
eligible to earn the brand name rose to a record
32.5%, up from just 17.8% a decade ago.
EVERY DIVISION SETS RECORDS
A global network of nearly 20,000 licensed
partners found individual business success
through brand recognition in retail meat cases
and on restaurant menus. Manageable prices
in concert with strong demand led to sales
records in every division of the Certified Angus
Beef ® brand.
The most robust growth took place in the
International Division, with 207 million
pounds exported to 50 countries outside the
United States – an 18.6% increase over last
year and the best in the brand’s history. What
comprised more than one-third of total brand
growth was due to the strong market in South
Korea, followed by Canada, Japan, Hong
Kong and Mexico.
Quality-focused retailers remained the
largest contributor to total brand sales, at
approximately 41%. A more favorable price
spread relative to commodity beef options
led to more Certified Angus Beef ® brand items
featured in circulars, thus growing retail sales
by 8.3% to a new high of 494 million pounds.
Nearly 11,000 licensed restaurants are
included in the Foodservice Division, which
netted sales of 405.5 million pounds, a
5.3% increase. The division boasted a ninth
consecutive year of record sales, further proof
of the brand’s value to chefs and restaurateurs
who prize its consistent quality, and patrons
who crave its flavor.
Processors responded to growing consumer
demand for high-quality convenience meals
in both retail and foodservice with branded
value-added products. Sales rose by 8.1% to
29.2 million pounds, driven most by smoked
brisket, marinated fajita meat and burgers in
the frozen case.
BALANCED CATEGORY GROWTH
Illustrating a steady desire from the industry’s
most discerning customers, and the rising tide
of quality at the ranch, sales of the brand’s
exclusive Prime product extension achieved its
highest growth ever at 31.2%.
Continuing a trend from last year, the brand
experienced a balanced rate of growth across
product categories. Backed by traditionally
strong demand, particularly for celebrations
and special occasions, sales of middle meats
(premium steaks) grew by 6.5% over last
year. Reflecting continued consumer appeal
for a better burger, ground beef increased
10.3% over 2017. Sales of roasts and other
end meats, which are often the centerpiece of
family meals, rose by 8.2%.
Total sales: 1.12 billion lbs. (up 8.1%)
12th consecutive record year
Year-over-year growth since 2004
8.3 %
494 MILLION LBS. 5.3 %
405.5 MILLION LBS. 18.6 %
207 MILLION LBS. SAME
RETAIL
FOODSERVICE
INTERNATIONAL
105.5 MILLION LBS.
MISC.
8.2 %
772 MILLION LBS. 6.5 %
265 MILLION LBS. 10.3 %
175 MILLION LBS. 8.1 %
END MEATS
ANGUS-INFLUENCED CATTLE ID
CARCASS CERTIFIED
®
CAB ACCEPTANCE RATE
2014
2015
2016
2017
2018
2014
2015
2016
2017
2018
2014
2015
2016
2017
2018
MIDDLE MEATS
GROUND BEEF
VALUE-ADDED
13.8 M
12.7 M
29.2 MILLION LBS.
13.6 M
15.2 M
15.9 M
3.5 M
3.5 M
3.9 M
4.5 M
5.2 M
25.6 %
27.5 %
28.9 %
29.7 %
32.5 %