Molson Coors Beverage Co. reports an eye-popping 623.9% increase in net profit after taxes to $342.4 million, or $1.57 a share, on an 11.8% rise in net sales to $3.27 billion.
It was the best quarter of reported net sales since Molson and Coors were merged in 2005.
Molson Coors’ second-quarter results were accelerated by trends in the beer industry, but the groundwork for success was already in place, said Gavin Hattersley, Molson Coors’ president and CEO.
“This achievement is not only a measure of three months in the second quarter, it’s a measure of the past three years. It’s about the work we’ve done to strengthen our business, which put us in a position to attract consumers when they began looking for alternatives,” he said in a call with analysts.
Molson Coors saw its best quarterly U.S. brand volume trend since the MillerCoors joint venture in 2008, leading to revenue growth in every channel, segment and region, Hattersley said.
The company is raising its 2023 guidance based on the continued strength of its core brands in the U.S., “while remaining mindful of the softness in the beer industry and continued caution around the consumer,” said Tracey Joubert, chief financial officer, also noting that Molson Coors will lap its 2022 price increases in the second half of the year and will begin unwinding a large contract brewing agreement that is scheduled to end in 2024.
A surging core
Molson Coors’ top three global brands – Coors Light, Miller Lite and Miller High Life – grew volume globally.
In the U.S., Molson Coors’ brand volumes were up 8.7%, driven by Coors Light, Miller Lite and Coors Banquet, which were all up double digits.
Combined, Coors Light and Miller Lite are now 50% bigger than Bud Light by total industry dollars and 30% bigger than Modelo Especial. In the second quarter of last year, by comparison, Bud Light was bigger than Coors Light and Miller Lite combined.
In the second quarter, Coors Light grew more industry dollar share than any other beer brand, Hattersley said, and it grew faster than Modelo Especial and Corona Extra combined.
In Canada, Coors Light and the Molson brand franchise grew volumes and share of the industry; Coors Light became the No. 1 light beer in Canada in March, as well as the No. 2 beer overall. Brand volume across the country increased 11.3%.
While Molson Coors’ top brands played a large role in the quarter’s results, Hattersley said the entire business contributed.
Growth across segments
In the U.S., Molson Coors gained the most dollar share in the second quarter, with Coors Light, Simply Spiked and Miller Lite representing three of the top five franchises. Each of Molson Coors’ top five U.S. brands grew dollar share.
Coors Banquet gained dollar share of U.S. total beer for the eighth straight quarter and Simply Spiked Peach was the best performing new product in the quarter by dollar share.
Meanwhile, Molson Coors gained more than 12,000 new tap handles last quarter and grew e-commerce sales at double the rate of the category’s leading platforms.
In the quarter, Molson Coors’ economy brands grew dollar share of U.S. total beer, with Miller High Life and Keystone Light growing volume.
Above premium drives global revenue
Globally, its above premium portfolio, highlighted by the success of Madrí Excepcional in the U.K., drove revenue.
Madrí helped drive Molson Coors’ on-premise performance, which hit its highest share level in over a decade. Madrí, which is also sold in the off-trade, saw triple-digit volume growth last quarter and is now the company’s fourth-largest above-premium brand globally.
More than half of Molson Coors EMEA & APAC revenue came from its above premium products.
A sound foundation
Hattersley said the company was on solid footing due to a series of strategic moves it made years ago, including improving its supply chain, investing in facilities and capabilities and changing its approach to marketing and media.
“We’re proving this business can grow the top and bottom line sustainably. We’re proving we have the resilience and wherewithal to navigate macro challenges affecting our industry and the world,” he said. “And we believe we’re proving that when we stick to a clear strategy over the long term, results will continue to follow.”