| 09-02-10 |
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AFX UK Focus |
By Dhanya Skariachan
NEW YORK, Feb 9 (Reuters) - Retail pundits who spread the "beer is recession-proof" theory might want to take a closer look at brewer Molson Coors' results.
On Tuesday, the brewer of Coors Light and Molson Canadian reported a lower-than-expected quarterly profit on weak sales volume across all markets and issued a tepid volume forecast for 2010, sending its shares down 3 percent.
Molson Coors was also weighed down by cost inflation in the United States and Britain.
"Things were worse than we expected in the fourth quarter and that seems to have been impacted mainly by the level of unemployment," Molson CEO Peter Swinburn said in an interview. "If people haven't got the money they can't spend it."
Swinburn added that an overall slowing of the beer market seen in the fourth quarter has continued into the first couple weeks of January.
"Looking to 2010, we expect volume to remain challenging, especially in the first half," Swinburn said.
Some analysts raised concerns about the beer consumption trends in the United States, especially since beer's relatively low price had formerly made many consider it somewhat resilient in the downturn.
"What we have seen was that really low-end value brands were growing quite a bit because consumers were trading down. Surprisingly, the entire U.S. beer universe volumes fell 2.5 percent in 2009," Morningstar analyst Ann Gilpin said.
"That just goes to show how deep this recession is," she said.
Molson shares, which had fallen about 9 percent year to date, were down $1.26 at $40.05 on the New York Stock Exchange.
Despite the stock's "reasonable" valuation that was at the low end of its global peers, Morgan Stanley's Dara Mohsenian rated it at "equal-weight."
"The stock lacks fundamental catalysts here, with weak US beer industry volume trends and a tenuous Canadian pricing environment," he said in a note.
Swinburn said he was comfortable with the pricing environment moving forward, noting that price increases recently taken in the United States were in line with inflation.
In the latest fourth quarter, Molson Coors earned $222.1 million, or $1.19 a share, compared with $93.7 million, or 51 cents a share, a year earlier.
Excluding items, profit was $1.02 a share, missing analysts' average forecast of $1.10, according to Thomson Reuters I/B/E/S.
Sales excluding excise taxes rose 11 percent to $820.8 million. Worldwide beer volume declined 4 percent as consumers remained cautious in the weak economy.
Earlier on Tuesday, MillerCoors, the combined U.S. operations of Molson and SABMiller PLC, reported a 21.6 percent slide in fourth-quarter net income reflecting a tough economy and a sharp rise in share-based salary bonus packages.
"It's tough out there, and we saw the effect of ongoing economic pressure and unemployment on beer sales, especially in the fourth quarter," MillerCoors CEO Leo Kiely said in a statement.
(Reporting by Dhanya Skariachan; Additional reporting by Martinne Geller, editing by John Wallace, Dave Zimmerman and Bernard Orr)
((dhanya.skariachan @thomsonreuters.com; + 1 646 223 6191; Reuters Messaging:dhanya.skariachan.reuters.com@reuters.net)) Keywords: MOLSONCOORS/
(See http://blogs.reuters.com/shop-talk/ for Shop Talk -- Reuters' retail and consumer blog.)
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The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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| 09-02-10 |
|
AFX UK Focus |
By Dhanya Skariachan
NEW YORK, Feb 9 (Reuters) - Retail pundits who spread the "beer is recession-proof" theory might want to take a closer look at brewer Molson Coors' results.
On Tuesday, the brewer of Coors Light and Molson Canadian reported a lower-than-expected quarterly profit on weak volumes across all markets and issued a tepid volume forecast for 2010.
Molson Coors was also weighed down by cost inflation in the United States and Britain.
"Overall consumer demand remains sluggish, and we see these conditions continuing to impact volume and mix in the near term," said Peter Swinburn, Molson Coors president and chief executive officer.
"Looking to 2010, we expect volume to remain challenging, especially in the first half," Swinburn added.
Some analysts raised concerns about the beer consumption trends in the United States, especially since beer's relatively low price had formerly made many consider it somewhat resilient in the downturn.
"What we have seen was that really low-end value brands were growing quite a bit because consumers were trading down. Surprisingly, the entire U.S. beer universe volumes fell 2.5 percent in 2009," Morningstar analyst Ann Gilpin said.
"That just goes to show how deep this recession is," she said.
Promotions by some wine and spirits brands, as well as price increases on some beers to cover rising commodity costs, has also heightened competition in the beer industry.
Molson Coors shares, which have fallen about 9 percent year to date, were down 1.3 percent at $40.76.
Despite the stock's "reasonable" valuation that was at the low end of its global peers, Morgan Stanley's Dara Mohsenian rated it at "equal-weight."
"The stock lacks fundamental catalysts here, with weak US beer industry volume trends and a tenuous Canadian pricing environment," he said in a note.
In the latest fourth quarter, Molson Coors earned $222.1 million, or $1.19 a share, compared with $93.7 million, or 51 cents a share, a year earlier.
Excluding items, profit was $1.02 a share, missing analysts' average forecast of $1.10, according to Thomson Reuters I/B/E/S.
Sales excluding excise taxes rose 11 percent to $820.8 million. Worldwide beer volume declined 4 percent as consumers remained cautious in the weak economy.
Earlier on Tuesday, MillerCoors, the combined U.S. operations of Molson and SABMiller PLC, reported a 21.6 percent slide in fourth-quarter net income reflecting a tough economy and a sharp rise in share-based salary bonus packages.
"It's tough out there, and we saw the effect of ongoing economic pressure and unemployment on beer sales, especially in the fourth quarter," MillerCoors CEO Leo Kiely said in a statement.
(Reporting by Dhanya Skariachan; Additional reporting by Martinne Geller, editing by John Wallace, Dave Zimmerman)
((dhanya.skariachan @thomsonreuters.com; + 1 646 223 6191; Reuters Messaging:dhanya.skariachan.reuters.com@reuters.net)) Keywords: MOLSONCOORS/
(See http://blogs.reuters.com/shop-talk/ for Shop Talk -- Reuters' retail and consumer blog.)
COPYRIGHT
Copyright Thomson Reuters 2010. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
More
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| 09-02-10 |
|
AFX UK Focus |
NEW YORK, Feb 9 (Reuters) - Molson Coors Brewing Co reported a lower-than-expected quarterly profit on Tuesday mainly on weak volumes across all markets, prompting the beer maker to issue a tepid volume forecast for 2010.
The brewer of Coors Light and Molson Canadian was also weighed down by cost inflation in the United States and Britain.
"Overall consumer demand remains sluggish, and we see these conditions continuing to impact volume and mix in the near term," Peter Swinburn, Molson Coors president and chief executive officer said.
"Looking to 2010, we expect volume to remain challenging, especially in the first half," Swinburn added.
Beer's relatively low price has made it somewhat resilient in the global downturn. But promotions by some wine and spirits brands, as well as price increases on some beers to cover rising commodity costs, has heightened competition.
In the latest fourth quarter, Molson Coors earned $222.1 million, or $1.19 a share, compared with $93.7 million, or 51 cents a share, a year earlier.
Excluding items, profit was $1.02 a share, missing analysts' average forecast of $1.10, according to Thomson Reuters I/B/E/S.
Sales excluding excise taxes rose 11 percent to $820.8 million. Worldwide beer volume declined 4 percent as consumers remained cautious in the weak economy.
Earlier on Tuesday, MillerCoors, the combined U.S. operations of Molson and SABMiller PLC, reported a 21.6 percent slide in fourth-quarter net income reflecting a tough economy and a sharp rise in share-based salary bonus packages.
"It's tough out there, and we saw the effect of ongoing economic pressure and unemployment on beer sales, especially in the fourth quarter," MillerCoors CEO Leo Kiely said in a statement.
(Reporting by Dhanya Skariachan; Additional reporting by Martinne Geller, editing by John Wallace, Dave Zimmerman)
((dhanya.skariachan @thomsonreuters.com; + 1 646 223 6191; Reuters Messaging:dhanya.skariachan.reuters.com@reuters.net)) Keywords: MOLSONCOORS/
(See http://blogs.reuters.com/shop-talk/ for Shop Talk -- Reuters' retail and consumer blog.)
COPYRIGHT
Copyright Thomson Reuters 2010. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
More
|
| 09-02-10 |
|
AFX UK Focus |
NEW YORK, Feb 9 (Reuters) - Molson Coors Brewing Co reported a lower-than-expected quarterly profit on Tuesday, weighed down by weak volumes across all markets and cost inflation in the United States and Britain.
The brewer of Coors Light and Molson Canadian earned $222.1 million, or $1.19 a share, in the fourth quarter, compared with $93.7 million, or 51 cents a share, a year earlier.
Excluding items, profit was $1.02 a share, missing analysts' average forecast of $1.10, according to Thomson Reuters I/B/E/S.
Sales excluding excise taxes rose 11 percent to $820.8 million. Worldwide beer volume declined 4 percent as consumers remained cautious in the weak economy.
(Reporting by Dhanya Skariachan; editing by John Wallace)
((dhanya.skariachan @thomsonreuters.com; + 1 646 223 6191; Reuters Messaging:dhanya.skariachan.reuters.com@reuters.net)) Keywords: MOLSONCOORS/
(See http://blogs.reuters.com/shop-talk/ for Shop Talk -- Reuters' retail and consumer blog.)
COPYRIGHT
Copyright Thomson Reuters 2010. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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