US: StarBev buy hampers Molson Coors H1 profits, but sales stay steady
- H1 net profits fall by 39.6% to US$184.6m
- Net sales in six months to end of June inch up by 4.1% to $1.69bn
- Operating profits slip by 5.5% to $400.7m
- StarBev buy closes on 15 June
Molson Coors released its H1 results earlier today
Molson Coors has seen the closure of its "strategically compelling" purchase of StarBev hamper its first-half results, but a lift in worldwide volumes helped keep sales on course.
H1 net profits fell by 39.6% to US$184.6m in the six months to the end of June, while sales were up by 4.1% to $1.69bn, the North American brewer said today (7 August). Operating profits slipped by 5.5% to S400.7m.
In Q2 net profits also slipped, down by 52.3% to $105.1m. However, net sales edged up to $999.4m. Global beer volumes in the three-month period were up by 6.4% to 13.9m hectolitres.
The boost in sales was driven by a "positive performance" in its JV with SABMiller in the US, MillerCoors, and the inclusion of two weeks of Molson Coors Central Europe (MCCE) operations in the results, the company said. MillerCoors' net profits in Q2 rose by 9.1% to $436m due to "positive pricing, favourable brand mix and cost management". MCCE is the new name for the StarBev operations, which Molson Coors acquired earlier this year.
In Canada, Coors' underlying pre-tax profits fell by 0.6% to $139m in Q2, due to "adverse foreign currency movements". The UK also took a hit, with pre-tax profits dropping by 19.3% to $28m in the quarter, due to "lower volume, higher pension expense and higher marketing investment".
On the StarBev acquisition, which completed in June, Molson Coors' president & CEO Peter Swinburn said the firm regards the buy as a "strategically compelling and financially attractive transaction".
He added: "We expect this acquisition to increase shareholder value toward the early part of our 3-to-5 year return range."
Looking ahead, Swinburn said the strategy included "leveraging our above-premium portfolio and scaling our existing business in emerging markets".
Shares in Molson Coors were up by 5.15% at $42.32 today.
To read the brewer's official statement, click here.
To read Molson Coor's Q1 figures, click here.
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