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Post date: 05/14/2012 - 16:18

Profits Down at Molson-Coors

Molson Coors has reported a 4.1% decline net profit in the first quarter after weaker-than-expected sales in Canada and acquisition costs associated with the firm’s takeover of StarBev hit the Denver-based brewer’s bottom-line.
Net income reached $79.4 million, down from $82.6 million a year earlier. Earnings were at the top end of forecasts after gross margins at Molson Coors’ joint venture with SAB Miller beat expectations.

Molson Coors has reported a 4.1% decline net profit in the first quarter after weaker-than-expected sales in Canada and acquisition costs associated with the firm’s takeover of StarBev hit the Denver-based brewer’s bottom-line.
Net income reached $79.4 million, down from $82.6 million a year earlier. Earnings were at the top end of forecasts after gross margins at Molson Coors’ joint venture with SAB Miller beat expectations.

Sales of products such as Coors Light and Blue Moon fell by 0.5% in the Canada, bucking the industry trend of growth in the region of 1.3%.

Molson Coors, whose business is concentrated in Canada, the US and UK, registered a 0.1% increase in overall sales to $691.4 million. Revenue was lower than the $703.8 million that analysts had forecasted.
Volumes were also down 0.4% to 9.9 million hectolitres.

"We come away seeing incrementally positive margin news but with added concerns about the company's share trajectory in Canada and the U.S., its two largest markets," Mark Swartzberg, an analyst at Stifel Nicolaus told Reuters.

Last month, Molson revealed plans to boost its developing markets business by buying Eastern European brewer StarBev for €2.65 billion.

Yesterday, Molson Coors announced an executive reshuffle that will see Alain Beyens, StarBev’s chief executive leave the business once the deal is concluded. Mark Hunter, Molson UK and Ireland’s chief executive will succeed Beyens.

Hunter will be replaced by Stewart Glendinning, Molson Coors’ chief financial officer. Gavin Hattersley, previously Miller Coors’ executive vice president and chief financial officer has been appointed as Glendinning’s replacement.