SABMiller plc (LN:SAB; OTC:SABMRY) and Molson Coors Brewing Company (NYSE: TAP; TSX: TPX) reported solid pricing and strong Above Premium sales growth at MillerCoors in the second quarter, despite difficult trading conditions. Domestic net revenue per barrel increased 2.6 percent versus the same quarter in the prior year, while underlying net income declined 5.3 percent to $412.7 million.
“This was a tough volume quarter for us and for the beer industry overall,” said MillerCoors Chief Executive Officer Tom Long. “Our strategy to evolve our portfolio to the fast-growing and higher-margin areas of the business is working, as shown by the successful launch of Redd’s Apple Ale and the nationwide expansion of Leinenkugel’s Summer Shandy. Thanks to these initiatives, as well as the introduction of Third Shift Amber Lager and continued growth of Blue Moon Belgian White, we have already grown our Above Premium brand volumes to more than 9% of our portfolio in the quarter. While we continued to gain share in Premium Lights according to Nielsen data, we are working hard to restore volume growth which we believe will come as the health of the category is defined by the Premium Light performance.”
Second Quarter 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.
- Total net sales decreased 2.9 percent to $2.159 billion for the quarter.
- Total cost of goods sold (COGS) per barrel increased 2.4 percent.
- Underlying net income (a non-GAAP measure) decreased 5.3 percent to $412.7 million.
- Domestic net revenue per barrel, excluding contract brewing and company-owned distributor sales, increased 2.6 percent.
- Domestic sales-to-retailers (STRs) decreased 4.4 percent.
- Domestic sales-to-wholesalers (STWs) decreased 5.3 percent.