Molson Coors says new Canadian beers provided cushion from downturn
MONTREAL (CP) — The introduction of three new Canadian beer brands has helped Molson Coors Brewing Company to reduce the economic downturn’s impact on sales volumes, the company’s chief executive said Tuesday.
Increased spending on Molson M, Molson Canadian 67 and Rickard’s Dark contributed to a 12per-cent drop in pretax Canadian earnings. Including a 15 per cent appreciation of the Canadian dollar, earnings fell 5.3 per cent to US$94.5 million.
“Our brand work is beginning to give us the portfolio we require to improve (market) share and revenue performance in Canada going forward,” CEO Peter Swinburn said Tuesday during a conference call.
The Montreal and Denverbased brewer’s overall fourth-quarter profit more than doubled because of favourable tax benefits even as it sold fewer beers.
Worldwide volume sold of the company’s beers, including Blue Moon and Coors Light, fell four per cent as people cut back on their purchases. Still, higher prices helped drive an 11 per cent rise in net sales to $820.8 million.
Shares listed on the New York Stock Exchange (NYSE:TAP) decreased $1.32 to $39.99 in afternoon trading. Molson Coors Canada shares listed on the Toronto Stock Exchange (TSX:TPX.B) fell C$1.23, or 2.74 per cent, to $43.62.
Molson Coors has seen sales slip in its strongholds of Canada and Britain amid weak economies.
People are feeling pinched so they’re less likely to splurge on items like beer or go out to bars and restaurants. That’s forcing companies to drop their prices to compete, but Molson Coors has held firm on some pricing, particularly in Britain, so it can make more money on the products it does sell.
The brewer earned $218.2 million, or $1.17 per share in the quarter ending Dec. 26. That’s up from $87.6 million, or 48 cents per share, in last year’s fourth quarter.
Without one-time items, the company earned $190.3 million, or $1.02 a share.