SABMiller plc and Molson Coors Brewing Company reported that MillerCoors third quarter underlying net income increased 13.5 percent to $325.6 million versus prior year driven by positive pricing, favorable brand mix and continued strong cost management. Coors Light continued to grow volume and market share, and Tenth and Blake Beer Company continued to grow ahead of the overall craft segment.
“This quarter we delivered significant profit growth and improved our year-to-date share trend,” said MillerCoors Chief Executive Officer Tom Long. “Strong investment, clear positioning and packaging innovation for Coors Light have helped drive nearly eight consecutive years of growth for our largest brand.
Tenth and Blake demonstrated the power of its portfolio, marked by the continued growth of Blue Moon Belgian White and Leinenkugel’s Summer Shandy. We have a pipeline of innovation to drive our largest brands, and we’re launching exciting above premium products nationally in early 2013. Strong cost management remains a priority, and we are committed to our net revenue strategy and focus on positive brand mix to drive value.”
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. All sales-to-retail (STRs) results are presented on a trading-day-adjusted basis, as the third quarter of 2012 had one fewer trading day compared with the same quarter in the prior year.
• Underlying net income (a non-GAAP measure) increased 13.5 percent to $325.6 million.
• Total net sales increased 1.5 percent to $1.994 billion.
• Domestic net revenue per barrel, excluding contract brewing and company-owned distributor sales, increased 3.6 percent.
• Total cost of goods sold (COGS) per barrel increased 0.5 percent.
MillerCoors domestic STRs declined 2.4 percent. Domestic sales-to-wholesalers (STWs) decreased 2.6 percent. MillerCoors Premium Light STRs declined low-single digits in the third quarter versus prior year. Coors Light continued its momentum growing low-single digits for the quarter and outpacing the total premium light segment.
The brand will benefit from increased fourth quarter marketing investment and visibility in national advertising. Miller Lite declined mid-single digits, representing a slight decline in performance versus the first half of the year. Sales of 12- and 16- ounce Miller Lite punch-top cans increased low-single digits, marking the first time that the Miller Lite can business has been positive since the formation of MillerCoors.
Domestic net revenue per barrel grew 3.6 percent as a result of strong net pricing and an acceleration of favorable brand mix, driven by Tenth and Blake growth and the Economy portfolio decline.
Total company net revenue per barrel, including contract brewing and company-owned distributor sales, increased 3.0 percent. Third-party contract brewing volumes were up 8.7 percent.
Total COGS per barrel increased 0.5 percent driven by packaging innovation and commodity inflation, largely offset by strong cost savings.
