Molson Coors swings back to a quarterly profit, but stock still falls

By Ciara Linnane

The brewer achieved growth in market share, sales and volume in each of its three biggest global markets in 2023

Molson Coors Beverage Co.'s stock fell 1.8% on Tuesday, after failing to hold early gains made after the company revealed it had swung back to a profit in the fourth quarter from a loss a year ago, topping consensus estimates.

Molson Coors (TAP) earned net income of $103.3 million, or 48 cents a share, for the quarter after booking a loss of $590.5 million, or $2.73 a share, in the year-earlier period. The year-earlier number included non-cash impairment charges of $845 million.

Adjusted per-share earnings came to $1.19, ahead of the $1.12 analyst consensus, per FactSet data.

Sales rose to $2.791 billion from $2.629 billion a year ago, also ahead of the $2.781 billion analyst consensus, per FactSet.

The company managed volume, share and net-sales growth in each of its three biggest global markets in 2023, it said in a statement.

Molson Coors gained market share from rival Bud Light for most of last year, after that brand became the subject of a conservative-led boycott following the use of a transgender influencer in its marketing - sending beer drinkers to Molson Coors for light-beer alternatives.

The company expects the market-share changes to be permanent.

"We plan to build on this momentum in 2024, with strong commercial plans, a powerful and supportive distributor network and the financial flexibility to reinvest in our business," Chief Executive Gavin Hattersley said in a statement.

On a call with analysts, Hattersley emphasized that the market-share gains have pushed the company to a new baseline, boasting that it has achieved six years of profit growth in just one year.

"In 2023, our top-five brands around the world drove over 2 million more hectoliters than they did the prior year," he said, according to a FactSet transcript. "This is like adding the entirety of Blue Moon's global volume to our portfolio."

The company's outlook appeared promising, too, with CGA Nielsen's latest 12-week reading showing Molson Coors gaining over three times more on-premise market share (at bars, restaurants and establishments) than rival Constellation Brands Inc. (STZ)

"To put this performance into perspective, Coors Light and Miller Lite each grew more dollars in the on-premise [market] than Constellation did as a total brewer," he said.

Still, growth meant a 17.4% rise in marketing costs, with the company spending more than $50 million on promotions in the quarter.

Molson is now expecting 2024 sales to grow by a low-single-digit amount on a constant-currency basis. It expects underlying earnings per share to grow by a mid-single-digit amount and for cash flow to total $1.2 billion, plus or minus 10%.

The stock has gained 21% in the last 12 months, while the S&P 500 has gained 22.8%.

-Ciara Linnane

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02-13-24 1317ET

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