A bottle of Molson Canadian beer and a can of Coors Light are shown in this Nov. 28, 2017 in Walpole, Mass. THE CANADIAN PRESS/AP/Steven Senne

Molson Coors has worst trading day since 2005 as results widely miss expectations

MONTREAL — Molson Coors Brewing Co. had its worst trading day in more than a decade after the company widely missed expectations largely due to weakness in the United States.

The company’s shares sank more than 15 per cent to US$60.64 in trading on the New York Stock Exchange, hitting a nearly four-year low. That was the biggest one-day fall since April 2005.

The loss was less severe in Toronto where fewer of the company’s shares are traded. The stock closed down 6.7 per cent to C$93.51, one cent above a 52-week low.

The Denver and Montreal-based company said its sales fell 4.8 per cent to US$2.33 billion in the first quarter compared to the prior year quarter.

Sales in the U.S., which account for more than 70 per cent of global revenues, were down 5.8 per cent.

Canadian sales decreased 2.5 per cent to US$283.8 million. They were also down in Europe and international markets.

Net earnings attributable to shareholders were US$278.1 million or $1.28 per diluted share, compared with US$208.5 million or 96 cents per share a year ago.

The profits included a US$328-million gain from an adjustment on the purchase of Miller International and increased pricing.

Molson Coors CEO Mark Hunter tried to downplay the results, noting they came in a small quarter and as the entire U.S. beer industry had a softer-than-anticipated start to the year.

“We do not see these results as indicative of our full year performance versus our plan,” he said during a conference call.

Excluding one-time items, adjusted earnings for the three months ended March 31 fell about 40 per cent to US$104.3 million or 48 cents per diluted share.

That compared with US$172.2 million or 80 cents per share in the prior year.

Molson Coors was expected to post 78 cents per share in adjusted earnings on US$2.45 billion in revenues, according to analysts polled by Thomson Reuters.

The company endured some unique challenges in the quarter, including delays in ramping up a new ordering system at a U.S. brewery, but the underlying beer trends in the U.S. really spooked the market, said analyst Brittany Weissman of Edward Jones.

“There’s been a lot of concerns about the slowdown in the broader beer industry and I think it’s hard to know how much of that is due to weather and how much of that is potentially due to the acceleration in the declines,” she said in an interview.

Weissman said Molson Coors has done a good job generating cash.

“But it’s an unforgiving market. There’s some industry challenges and I think the reaction today reflects that.”

Canadian pre-tax profits were US$9.1 million, down from US$20.9 million the prior year quarter when it gained US$8.1 million from a price adjustment on the sale of its stake in the Montreal Canadiens.

Molson Coors said Canadian volume decreases — including Coors Light and Molson Canadian — came in the backdrop of a weak industry in Western Canada and higher inventory levels in Quebec as it was in the midst of union contract negotiations.

Meanwhile, the brewer said it is preparing to introduce several new beers into Canada, including Coor’s Edge, a non-alcoholic product. Other brands will be Leinenkugel Shandy and Henry’s Hard Soda.

“I think what they’re trying to do is leverage some of the innovation that they’ve had in the U.S. and the successes that they’ve had in the U.S. and bring them into other market,” added Weissman.

Follow ↕RossMarowits on Twitter.

Companies in this story: (TSX:TPX.B, NYSE:TAP)

Just Posted

Vandal strikes downtown business

Window with PRIDE poster broken

No new RNs hired to Red Deer hospital emergency department in a month: United Nurses of Alberta

UNA filed a grievance in June in response to what they say is a staffing crisis

Traffic pattern to change for summer near interchange

Southbound Hwy 2 traffic to be shifted

Red Deer couple win $100,000 in lottery

Couple won their money on June 1 LOTTO MAX with EXTRA draw

‘Walking survey’ of Red Deer’s green carts starts this week

Gold stars or pointers on correct use will be left on inspected carts

Updated: SUV smashes through fences and deck in Anders

Driver taken to hospital after SUV veered off 30th Avenue into Anders

Cull hasn’t been able to solve bunny burden in Alberta mountain town of Canmore

CANMORE, Alta. — Problems persist in an Alberta mountain town overrun with… Continue reading

Canada should help Holocaust denier on trial in Germany: civil liberties group

OTTAWA — A civil liberties group is urging the Canadian government to… Continue reading

Westerner Days: Send us your photos

Your reader photo may just make the pages of the Adovcate.

Adam Henrique signs $29.1M, 5-year extension with Ducks

ANAHEIM, Calif. — Centre Adam Henrique has signed a $29.1 million, five-year… Continue reading

Fashion firms upend design routine to focus on speed, trends

NEW YORK — Prototypes? Passe. Fashion company Betabrand saw that knitwear was… Continue reading

Trimming and tidying: Perennials need care too

The great attraction in growing perennial flowers is that you never have… Continue reading

Johnny Depp settles lawsuits involving former managers

LOS ANGELES — Johnny Depp has settled lawsuits with his former business… Continue reading

Cubs’ Kyle Schwarber falls to Bryce Harper in Home Run Derby final

WASHINGTON — Nationals Park was eerily quiet late Monday when Kyle Schwarber… Continue reading

Most Read


Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month