- Molson Coors had net income of $201.3 million in the first quarter, up from $162.7 million a year earlier, the company said in a statement. Sales rose to $2.91 billion from $950.8 million. Purchasing the remaining 58% stake in MillerCoors from SABMiller was largely responsible for the revenue bump.
- The beverage giant said U.S. domestic sales-to-retailers volume declined 2% during the quarter, driven by lower volume in the premium light and below premium segments. Volumes in Canada rose 0.7%, while increasing 9.6% in Europe due partly to the addition of the Miller brands, along with strong growth from Coors Light and Staropramen.
- "With the completion of the MillerCoors transaction late last year and the changes we are making to align and enhance our organization, 2017 will be a transition year as we build a larger, stronger First Choice-focused company," said Mark Hunter, president and chief executive officer of Molson Coors. "Our results today reflect increased investments in the building blocks that will drive top-line growth, cost savings, profit growth, cash generation, debt pay-down, and total shareholder returns in the years ahead."
The beer industry is digesting a pair of acquisitions last year that further consolidated around 90% of the U.S. domestic production into two major players — AB InBev and Molson Coors. The remainder is concentrated among popular craft breweries.
Molson Coors' decision to buy the stake it didn't own in Miller Coors was a smart move. It not only expanded the company's beer volume globally and boosted its revenue and profitability, but it gave greater purchasing power for everything from hops and barley to aluminum cans.
Miller Coors and AB InBev are taking time to integrate their recent deals before considering whether to make another acquisition. Pete Coors, vice chairman of Molson Coors, said at the Beverage Forum last week he expected more mergers, but noted there are only a few remaining players left that could combine.
"We going to catch our breath, and I think ABI is in the process of catching their breath," Coors said. "At some point down the road ... I have no doubt there will be additional consolidation globally."
In the meantime, Molson Coors — whose brands include Blue Moon, Miller Lite and Milwaukee's Best — could look to smaller bolt-on deals, focusing its attention on craft breweries. Coors told Food Dive his company has purchased four small regional craft breweries in the last 18 months.
With so few larger players left, and Molson Coors working through its recent deal, craft breweries could be a way to increase volume and efficiencies for the company. At the same time, these acquisitions could allows the larger company to attract millennials who crave the unique flavors and localized brews associated with craft beers.