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SABMiller plc (LN:SAB; OTC:SABMRY) and Molson Coors Brewing Company (NYSE: TAP; TSX: TPX) reported that MillerCoors underlying net income grew 9.5 percent for the full year 2012 to $1.223 billion, while fourth quarter underlying net income decreased 4.2 percent to $185.8 million versus the same quarter in the prior year. Positive pricing and favorable sales mix drove strong profitability for the year, while increased marketing investment reduced fourth quarter earnings.
“We delivered strong profit growth in 2012 while making significant marketing investments in the fourth quarter behind our brands,” said MillerCoors Chief Executive Officer Tom Long. “Our portfolio transformation strategy is delivering solid results. Coors Light, which is undoubtedly the healthiest major beer brand in the market, continued to show momentum and we led Craft share growth as Tenth and Blake delivered very strong results with Blue Moon and Leinenkugel’s.”
Fourth Quarter and Full Year Highlights
Unless otherwise indicated, all amounts are in U.S. dollars and calculated in accordance with U.S. GAAP. All percentages are versus the prior-year comparable period and include MillerCoors operations in the U.S. and Puerto Rico. Quarterly sales-to-retailers (STRs) results are presented on a trading-day-adjusted basis, as the fourth quarter of 2012 had one more trading day compared with the same quarter in the prior year.
Underlying net income (a non-GAAP measure) increased 9.5 percent to $1.223 billion for the year and decreased 4.2 percent to $185.8 million for the fourth quarter.
Total net sales increased 2.8 percent to $7.761 billion for the year and 1.7 percent to $1.784 billion for the quarter.
Domestic net revenue per barrel, excluding contract brewing and company-owned distributor sales, increased 3.5 percent for the year and 2.9 percent for the quarter.
Total cost of goods sold (COGS) per barrel increased 1.4 percent for the year and 1.6 percent for the quarter.
Domestic STRs decreased 1.3 percent for the year and 1.1 percent for the quarter.
Domestic sales-to-wholesalers (STWs) decreased 1.1 percent for the year and 1.3 percent for the quarter.
Brand Highlights for the Fourth Quarter and Full Year
Coors Light continued its momentum growing low-single digits for the quarter, outpacing the total category and the Premium Light segment which lost share in a flat industry. The brand enjoyed its eighth consecutive year of volume growth and MillerCoors will enter 2013 with a continued focus on multicultural outreach for Coors Light, including sponsorship of The Mexican Soccer League, Liga MX and the return of “Search for the Coldest” in partnership with Ice Cube. Building on the success of its packaging innovations, MillerCoors will launch the new Coors Light “World’s Most Refreshing Can” in the second quarter of 2013. Miller Lite declined mid-single digits for the quarter and low-single digits for the full year. We will continue to invest in the “It’s Miller Time” campaign and will launch a new iconic bottle for the on-premise in mid-2013, following the positive volume impact of the Miller Lite punch top can in 2012. Miller64 STRs were down low-single digits in the quarter and high-single digits for the full year. Volume trends on the brand have improved significantly since it’s re-positioning in the first quarter of 2012. MillerCoors Premium Light STRs declined low-single digits in the fourth quarter and for the full year.