DENVER (AP) â¿¿ Molson Coors Brewing Co.'s fourth-quarter net income fell by more than half as it sold less beer in the U.S. and U.K. and dealt with rising taxes and higher costs for ingredients and fuel.
The results missed analysts' average expectations, according to FactSet, and Molson's shares fell more than 4 percent Thursday.
The Denver company raised prices in the downturn to protect its profit margins, and it sold less beer as a result. Before the fourth quarter, cost-cutting was helping its profit rise.
Molson Coors reported Thursday that it earned $109.8 million, or 58 cents per share, for the quarter that ended Dec. 25. That's down 51 percent from $222.1 million, or $1.19 per share, a year earlier. Adjusted earnings amounted to 66 cents a share.Last year's quarter was boosted by an unusually low tax rate, the company said. Revenue excluding excise taxes rose 1.7 percent to $835.1 million because of higher prices. The results fell short of analysts' forecasts. Analysts were looking for earnings of 69 cents per share on revenue of $837.4 million. "In the U.S., unemployment amongst our core consumer base remains high, and U.S. beer industry volumes continue to be weak," said Peter Swinburn, president and CEO of Molson Coors. The company offset that by raising prices and cutting costs, he said. Net income for Molson's U.S. joint venture with SABMiller, Miller Coors, rose 41 percent to $144.2 million. But that too was short of what analysts expected, said Barclays Capital analyst Erica Chase. The lower-than-expected profit growth in the U.S. overpowered better Canadian results and U.K. results that were in line with expectations, she said in a note to investors. Molson Coors says it sold 1.9 percent less beer globally. The United Kingdom was particularly weak. Sales there fell 4.9 percent. To offset weakness in more established markets, the company is trying to expand in emerging markets such as China and woo new drinkers to its Coors Light brand. Volume in the unit that includes sales outside the U.S., Canada and Britain rose 55 percent, but the unit remains a tiny portion of Molson Coors' business.
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