Molson Coors Beverage Company today reported net income of $342.8 million, or $1.58 per share, on net sales of $2.75 billion in its third quarter, beating Wall Street’s expectations for the top and bottom line for the second consecutive quarter.
Molson Coors CEO Gavin Hattersley said in a call with analysts that the company was “very pleased” with its performance in the quarter and has “made tangible progress” on the restructuring and revitalization plan it announced a year ago.
Amid continued disruptions and a tough business environment caused by the global coronavirus pandemic, sales slipped 3.1% from the year-ago quarter, due in part to sustained restrictions to on-premise venues such as bars, restaurants, taverns, pubs and stadiums, unfavorable channel mix across all major markets and packaging material constraints in North America, the company said.
Despite those challenges, Hattersley said, "we never lost sight of our goals or the path we set out on early in the year" and Molson Coors is "showing what's possible when we execute that plan."
The company is "building on the strength of our core while growing our above-premium portfolio and planting the seeds for future growth beyond beer,” Hattersley said. “And we’re investing in our capabilities and our people to make it all possible.”
Those investments already are paying off, he said. Molson Coors’ top-selling beer, Coors Light, is up 6% in the off-premise so far this year in the U.S., per Nielsen. Combined with Miller Lite, which has booked 9.5% growth over the same period, the two brands have grown their share of the premium lights segment for 24 consecutive quarters.
The Blue Moon franchise, meanwhile, has posted the highest growth among all craft franchises in 2020, according to Nielsen. And its spinoff Blue Moon LightSky, which launched in February, remains 2020’s top-selling new beer in the U.S., data show.
In Europe, the company’s brands posted “significant trend improvement” in the third quarter after bars, pubs and taverns reopened during the period. Staropramen, for instance, grew volume by 9% during the quarter versus prior year.
Its hard seltzer portfolio, which includes Vizzy and Coors Seltzer, has doubled its share of the U.S. hard seltzer market so far in 2020, per Nielsen data. With two portfolio additions on the way in 2021 – Topo Chico Hard Seltzer and Proof Point – “we plan to capture a double-digit share of the U.S. hard seltzer market” by the end of 2021, Hattersley said.
He also pointed to early success of Truss, its Canadian joint-venture with Hexo Corp., which has “quickly become a market share leader of ready-to-drink cannabis beverages in Canada” and holds an estimated market share of more than 50% in certain key markets such as Quebec. That, combined with a slate of non-alcohol products created in partnership with beverage incubator L.A. Libations, as well as other products borne out of strategic relationships with high-end brands across the globe, could make Molson Coors' Emerging Growth division a $1 billion business within three years, Hattersley said.
“For as much activity as you’ve seen in the past few months, you can expect to see more coming,” Hattersley said.
Molson Coors continues to invest behind its capabilities to meet shifting consumer demand. Projects include:
- To meet booming demand for Blue Moon LightSky, the company plans to complete a project to expand production capacity of that beer by more than 400%.
- Rocky Mountain Metal Container, a joint venture with Ball Corp., just turned on a new slim-can production line capable of producing 750 million cans a year.
- Molson Coors broke ground on a giant, multi-year modernization of its brewery in Golden, Colo.
- And, it’s made investments in building its ecommerce capabilities during the pandemic, boosting online sales in Canada by 400% and in the U.S. by 200%.
“These investments will help power our business forward,” Hattersley said. “And we will continue prioritizing capital projects to continue expanding our production capacity for seltzers and innovations in 2021 and 2022.”
*Full details can be found in Molson Coors’ third-quarter earnings release, including forward looking statement disclaimers and full financial results.