Net Sales Nearly Flat while Income Before Income Taxes Improves
26.9% or 5.2% on an Underlying Basis in Constant Currency
Returns $353 Million to Shareholders Through Dividend and Share
Repurchases
Reaffirms 2024 Full Year Guidance for Top-Line and Bottom-Line
Growth
Molson Coors Beverage Company ("MCBC," "Molson Coors" or "the
Company") (NYSE: TAP, TAP.A; TSX: TPX.A, TPX.B) today reported
results for the 2024 second quarter.
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the full release here:
https://www.businesswire.com/news/home/20240806604516/en/
2024 SECOND QUARTER FINANCIAL HIGHLIGHTS1
- Net sales decreased 0.4% reported and 0.1% in constant
currency.
- U.S. GAAP income before income taxes of $559.9 million
increased 26.9% reported.
- Underlying (Non-GAAP) income before income taxes of $531.2
million improved 5.2% in constant currency.
- U.S. GAAP net income attributable to MCBC of $427.0 million,
$2.03 per share on a diluted basis. Underlying (Non-GAAP) diluted
earnings per share of $1.92 per share increased 7.9%.
CEO AND CFO PERSPECTIVES
Molson Coors had strong results this quarter which played out
largely as we expected. In the second quarter of 2024, we
essentially held the top line and grew the bottom line 5.2% while
cycling the strongest second quarter of U.S. GAAP reported net
sales since the 2005 Molson and Coors merger. For the six months
ended June 30, 2024, net sales increased 4.2% on a constant
currency basis, while underlying income before income taxes
increased 20.4% on a constant currency basis.
Our performance in the first half of the year was largely driven
by favorable price and favorable U.S. shipment timing offset by
lower contract brewing volumes. To ensure we met supply needs
during the peak summer season, we deliberately increased our U.S.
distributor inventories ahead of and during the strike at our Fort
Worth brewery which ran 14 weeks from February to May. This dynamic
does not impact our expectations for the full year but does
significantly impact the timing of our results over the course of
the year, which is why we are maintaining our guidance for the full
year 2024. Additionally, our America's financial volume was
impacted by the exit of over 900,000 hectoliters related to the
wind down of a major contract brewing arrangement which terminates
at the end of the year.
We continue to make progress against our strategic priorities
and execute against our Acceleration Plan initiatives. According to
Circana, in the U.S., Coors Light, Miller Lite and Coors Banquet
second quarter combined volume share is down a half share point of
industry versus a year ago when we saw our peak share gains.
However, these brands remain up 2 full share points compared to the
second quarter of 2022. This means that we retained approximately
80% of our peak share gains on our core power brands in the U.S. In
EMEA&APAC, strong core power brand results were supported by
Ožujsko which continues to gain value share in Croatia, and the
launch of a new brand in Romania, Caraiman, which has delivered
about 150,000 hectoliters already.
Progress against our premiumization strategy is at different
stages across our markets as we have had strong success in
EMEA&APAC, Canada and Latin America with focused plans in the
U.S. to drive improvement.
With strong cash flow, we continued to invest in our business,
supporting our brands globally and continuing to build capabilities
that help drive long-term, sustainable and profitable growth. We
did this while returning $564 million in cash to shareholders in
the first half of the year through both our dividends and share
repurchase program, which accelerated during the second
quarter.
______________________ 1 See Appendix for definitions and
reconciliations of non-GAAP financial measures including constant
currency.
Gavin Hattersley, President and Chief Executive Officer
Statement:
"We are confident in our strategy, the trajectory of our total
business, and in our short and long-term growth objectives. We've
just delivered another quarter of bottom-line growth and strong
cash flow, and the highly cash-generative nature of our business
has enabled us to continue investing in our brands and our
capabilities to support our progress against our strategic
initiatives. We are a much different company today than we were
four years ago and we are certainly stronger than we were just 16
months ago."
Tracey Joubert, Chief Financial Officer Statement:
"Given our strong performance for the first half of the year, we
are reaffirming our full year 2024 guidance which would mean top
and bottom-line growth for the third straight year. And while this
guidance implies challenging second half trends related to U.S.
shipment timing, we remain confident in our growth algorithm which
has multiple levers. From our robust revenue management platform,
to our premiumization and innovation plans, to our continued
investments to drive efficiencies and cost savings, these levers
help us to navigate various market circumstances."
CONSOLIDATED PERFORMANCE - SECOND QUARTER 2024
For the Three Months
Ended
($ in millions, except per share data)
(Unaudited)
June 30, 2024
June 30, 2023
Reported Increase
(Decrease)
Foreign Exchange
Impact
Constant Currency Increase
(Decrease)(1)
Net sales
$
3,252.3
$
3,266.6
(0.4
)%
$
(12.2
)
(0.1
)%
U.S. GAAP income (loss) before income
taxes
$
559.9
$
441.1
26.9
%
$
2.6
26.3
%
Underlying income (loss) before income
taxes(1)
$
531.2
$
502.2
5.8
%
$
2.7
5.2
%
U.S. GAAP net income (loss)(2)
$
427.0
$
342.4
24.7
%
Per diluted share
$
2.03
$
1.57
29.3
%
Underlying net income (loss)(1)
$
404.2
$
387.2
4.4
%
Per diluted share
$
1.92
$
1.78
7.9
%
Financial volume(3)
22.430
23.385
(4.1
)%
Brand volume(3)
21.715
22.822
(4.9
)%
For the Six Months
Ended
($ in millions, except per share data)
(Unaudited)
June 30, 2024
June 30, 2023
Reported Increase
(Decrease)
Foreign Exchange
Impact
Constant Currency Increase
(Decrease)(1)
Net sales
$
5,848.7
$
5,612.9
4.2
%
$
0.4
4.2
%
U.S. GAAP income (loss) before income
taxes
$
825.3
$
543.0
52.0
%
$
(5.0
)
52.9
%
Underlying income (loss) before income
taxes(1)
$
790.0
$
660.0
19.7
%
$
(4.8
)
20.4
%
U.S. GAAP net income (loss)(2)
$
634.8
$
414.9
53.0
%
Per diluted share
$
2.99
$
1.91
56.5
%
Underlying net income (loss)(1)
$
607.0
$
503.5
20.6
%
Per diluted share
$
2.86
$
2.31
23.8
%
Financial volume(3)
40.404
40.391
—
%
Brand volume(3)
38.614
39.003
(1.0
)%
(1)
Represents income (loss) before income taxes and net income (loss)
attributable to MCBC adjusted for non-GAAP items. See Appendix for
definitions and reconciliations of non-GAAP financial measures
including constant currency.
(2)
Net income (loss) attributable to
MCBC.
(3)
See Worldwide and Segmented Brand and
Financial Volume in the Appendix for definitions of financial
volume and brand volume as well as the reconciliation from
financial volume to brand volume.
QUARTERLY CONSOLIDATED HIGHLIGHTS (VERSUS SECOND QUARTER 2023
RESULTS)
- Net sales: The following table highlights the drivers of
the change in net sales for the three months ended June 30, 2024
compared to June 30, 2023 (in percentages):
Net Sales Drivers
(unaudited)
Financial volume
(4.1
%)
Price and sales mix
4.0
%
Currency
(0.3
%)
Total consolidated net sales
(0.4
%)
Net sales decreased 0.4%, driven by lower
financial volumes and unfavorable foreign currency impacts,
partially offset by favorable price and sales mix. Net sales
decreased 0.1% in constant currency.
Financial volumes decreased 4.1%, primarily
due to lower contract brewing volumes in the Americas segment.
Brand volumes decreased 4.9%, including a 7.3% decrease in the
Americas, which was partially offset by a 2.0% increase in
EMEA&APAC.
Price and sales mix favorably impacted net
sales by 4.0%, primarily due to increased net pricing as well as
favorable sales mix for both segments, including as a result of
lower contract brewing volumes in the U.S.
- Cost of goods sold ("COGS"): decreased 6.1% on a
reported basis, primarily due to lower financial volumes, lower
cost of goods sold per hectoliter and favorable foreign currency
impacts. COGS per hectoliter: improved 2.1% on a reported
basis, including favorable foreign currency impacts of 0.4%,
primarily due to the favorable changes in our unrealized
mark-to-market derivative positions of $91.5 million and cost
savings initiatives, partially offset by cost inflation related to
materials and manufacturing expenses, volume deleverage and
unfavorable mix driven by lower contract brewing volumes in the
Americas segment. Underlying COGS per hectoliter: increased
2.9% in constant currency, primarily due to cost inflation related
to materials and manufacturing expenses, volume deleverage and
unfavorable mix driven by lower contract brewing volumes in the
Americas segment, partially offset by cost savings
initiatives.
- Marketing, general & administrative ("MG&A"):
decreased 0.9% on a reported basis, primarily due to lower
incentive compensation expense and favorable foreign currency
impacts, partially offset by increased marketing investment to
support our brands and innovations. Underlying MG&A:
decreased 0.4% in constant currency.
- U.S. GAAP income (loss) before income taxes: U.S. GAAP
income before income taxes improved 26.9% on a reported basis,
primarily due to favorable changes to our unrealized mark-to-market
derivative positions, increased net pricing, favorable sales mix
and cost savings initiatives, partially offset by lower financial
volumes and cost inflation related to materials and manufacturing
expenses.
- Underlying income (loss) before income taxes: Underlying
income before income taxes improved 5.2% in constant currency,
primarily due to increased net pricing, favorable sales mix and
cost savings initiatives, partially offset by lower financial
volumes and cost inflation related to materials and manufacturing
expenses.
(Unaudited)
For the Three Months
Ended
June 30, 2024
June 30, 2023
U.S. GAAP and Non-GAAP Underlying
effective tax rate
24
%
22
%
The increase in our second quarter U.S.
GAAP effective tax rate and Underlying effective tax
rate was primarily due to the recognition of tax expense items
in the three months ended June 30, 2024, which in the aggregate
were immaterial, compared to the recognition of tax benefit items
in the prior year, which in the aggregate were also immaterial.
QUARTERLY SEGMENT HIGHLIGHTS (VERSUS SECOND QUARTER 2023
RESULTS)
Americas Segment Overview
The following table highlights the Americas segment results for
the three and six months ended June 30, 2024 compared to June 30,
2023.
For the Three Months
Ended
($ in millions, except per share data)
(Unaudited)
June 30, 2024
June 30, 2023
Reported % Change
FX Impact
Constant Currency % Change
(2)
Net sales(1)
$
2,575.9
$
2,621.7
(1.7
)
$
(6.9
)
(1.5
)
Income (loss) before income taxes(1)
$
487.1
$
487.3
—
$
(1.1
)
0.2
Underlying income (loss) before income
taxes(1)(2)
$
487.4
$
487.6
—
$
(1.1
)
0.2
For the Six Months
Ended
($ in millions, except per share data)
(Unaudited)
June 30, 2024
June 30, 2023
Reported % Change
FX Impact
Constant Currency % Change
(2)
Net sales(1)
$
4,721.3
$
4,560.7
3.5
$
(6.1
)
3.7
Income (loss) before income taxes(1)
$
807.7
$
720.7
12.1
$
(2.4
)
12.4
Underlying income (loss) before income
taxes(1)(2)
$
808.5
$
721.5
12.1
$
(2.4
)
12.4
The reported percent change and the constant currency percent
change in the above table are presented as (unfavorable)
favorable.
(1)
Includes gross inter-segment volumes,
sales and purchases, which are eliminated in the consolidated
totals.
(2)
Represents income (loss) before income
taxes adjusted for non-GAAP items. See Appendix for definitions and
reconciliations of non-GAAP financial measures including constant
currency.
Americas Segment Highlights (Versus Second Quarter 2023
Results)
- Net sales: The following table highlights the drivers of
the change in net sales for the three months ended June 30, 2024
compared to June 30, 2023 (in percentages):
Net Sales Drivers
(unaudited)
Financial volume
(5.6
%)
Price and sales mix
4.1
%
Currency
(0.2
%)
Total Americas net sales
(1.7
%)
Net sales decreased 1.7% driven by lower
financial volumes and unfavorable foreign currency impacts,
partially offset by favorable price and sales mix.
Financial volumes decreased 5.6%, primarily
due to lower contract brewing volumes in the U.S. related to the
wind down of a contract brewing arrangement leading up to the
termination by the end of 2024 and a decrease in U.S. brand
volumes, partially offset by favorable U.S. shipment timing.
Americas brand volumes decreased 7.3%, including a 7.8% decrease in
the U.S., primarily due to cycling double digit growth in our core
power brands, lower above premium volumes versus prior year and
unfavorable holiday load in timing.
Price and sales mix favorably impacted net
sales by 4.1%, primarily due to increased net pricing and favorable
sales mix as a result of lower contract brewing volumes in the
U.S.
- U.S. GAAP and Underlying income (loss) before income
taxes: U.S. GAAP income before income taxes was flat on a
reported basis and underlying income before income taxes improved
0.2% in constant currency, primarily due to increased net pricing,
favorable sales mix, lower MG&A and cost savings initiatives,
partially offset by lower financial volumes and cost inflation
related to materials and manufacturing expenses. Lower MG&A
spend was primarily due to lower incentive compensation expense,
partially offset by increased marketing investment to support our
brands and innovations.
EMEA&APAC Segment Overview
The following table highlights the EMEA&APAC segment results
for the three and six months ended June 30, 2024 compared to June
30, 2023.
For the Three Months
Ended
($ in millions, except per share data)
(Unaudited)
June 30, 2024
June 30, 2023
Reported % Change
FX Impact
Constant Currency % Change
(2)
Net sales(1)
$
683.3
$
649.0
5.3
$
(5.3
)
6.1
Income (loss) before income taxes(1)
$
81.2
$
64.2
26.5
$
(1.9
)
29.4
Underlying income (loss) before income
taxes(1)(2)
$
81.0
$
64.2
26.2
$
(1.8
)
29.0
For the Six Months
Ended
($ in millions, except per share data)
(Unaudited)
June 30, 2024
June 30, 2023
Reported % Change
FX Impact
Constant Currency % Change
(2)
Net sales(1)
$
1,138.0
$
1,059.1
7.4
$
6.5
6.8
Income (loss) before income taxes(1)
$
70.2
$
38.8
80.9
$
(3.8
)
90.7
Underlying income (loss) before income
taxes(1)(2)
$
63.7
$
42.4
50.2
$
(3.5
)
58.5
The reported percent change and the constant currency percent
change in the above table are presented as (unfavorable)
favorable.
(1)
Includes gross inter-segment volumes,
sales and purchases, which are eliminated in the consolidated
totals.
(2)
Represents income (loss) before income
taxes adjusted for non-GAAP items. See Appendix for definitions and
reconciliations of non-GAAP financial measures including constant
currency.
EMEA&APAC Segment Highlights (Versus Second Quarter 2023
Results)
- Net sales: The following table highlights the drivers of
the change in net sales for the three months ended June 30, 2024
compared to June 30, 2023 (in percentages):
Net Sales Drivers
(unaudited)
Financial volume
0.3
%
Price and sales mix
5.8
%
Currency
(0.8
%)
Total EMEA&APAC net sales
5.3
%
Net sales increased 5.3%, driven by favorable
price and sales mix and higher financial volume, partially offset
by unfavorable foreign currency impacts. Net sales increased 6.1%
in constant currency.
Financial volumes increased 0.3% and brand
volumes increased 2.0%, primarily driven by Central and Eastern
Europe volume growth driven by the favorable performance of our
core power brands and above premium brands and the easing
inflationary pressures on the consumer, partially offset by lower
volumes in Western Europe due to soft market demand and high
promotional activity from the competition.
Price and sales mix favorably impacted net
sales by 5.8%, primarily due to increased net pricing and favorable
sales mix driven by premiumization.
- U.S. GAAP and Underlying income (loss) before income
taxes: U.S. GAAP income before income taxes improved 26.5% on a
reported basis and underlying income before income taxes improved
29.0% in constant currency, primarily due to increased net pricing,
favorable sales mix and cost savings initiatives, partially offset
by higher MG&A expense. Higher MG&A expense was primarily
due to increased marketing to support our brands and innovations as
well as cost inflation.
CASH FLOW AND LIQUIDITY HIGHLIGHTS
- U.S. GAAP cash from operations: Net cash provided by
operating activities was $894.6 million for the six months ended
June 30, 2024 which increased $0.2 million compared to the prior
year, primarily due to higher net income offset by lower non-cash
expense and the unfavorable changes in working capital. The
unfavorable changes in working capital were primarily driven by the
timing of cash receipts as well as higher payments for annual
incentive compensation.
- Underlying free cash flow: Cash generated of $505.0
million for the six months ended June 30, 2024 represents a
decrease in cash provided of $64.7 million from the prior year,
which was primarily due to higher capital expenditures driven by
the timing of capital projects.
- Debt: Total debt as of June 30, 2024 was $7,055.7
million and cash and cash equivalents totaled $1,647.3 million,
resulting in net debt of $5,408.4 million and a net debt to
underlying EBITDA ratio of 2.13x. As of June 30, 2023, our net debt
to underlying EBITDA ratio was 2.50x. Subsequent to June 30, 2024,
we repaid our EUR 800 million 1.25% notes upon their maturity on
July 15, 2024 using the proceeds from our EUR 800 million 3.8%
notes issued on May 29, 2024 and cash on hand.
- Dividends: We paid cash dividends of $188.4 million and
$178.2 million for the six months ended June 30, 2024 and June 30,
2023, respectively.
- Share Repurchase Program: We paid $375.3 million and
$26.7 million, including brokerage commissions, for share
repurchases during the six months ended June 30, 2024 and June 30,
2023, respectively. The current year share repurchases were made
under the share repurchase program approved on September 29, 2023
and the prior year share repurchases were made under the share
repurchase program approved on February 17, 2022.
2024 OUTLOOK
We continue to expect to achieve the following key financial
targets for full year 2024:
- Net Sales: low single-digit increase versus 2023 on a
constant currency basis.
- Underlying income (loss) before income taxes: mid
single-digit increase compared to 2023 on a constant currency
basis.
- Underlying diluted earnings per share: mid single-digit
increase compared to 2023.
- Capital expenditures: $750 million incurred, plus or
minus 5%.
- Underlying free cash flow: $1.2 billion, plus or minus
10%.
- Underlying depreciation and amortization: $700 million,
plus or minus 5%.
- Consolidated net interest expense: $210 million, plus or
minus 5%.
- Underlying effective tax rate: in the range of 23% to
25% for 2024.
These targets are based on the following key considerations:
- In the U.S., our sales to wholesalers were deliberately ahead
of sales to retailers by about 1.1 million hectoliters in the first
half of the year as compared to sales to wholesalers being behind
sales to retailers by about 0.4 million in the first half of 2023.
We expect this to reverse in the second half of the year, mostly in
the third quarter, as we currently plan to ship to consumption for
the full year.
- The wind down of a contract brewing agreement leading up to the
termination by the end of 2024 is expected to result in a reduction
in Americas' financial volume by approximately 1.0 million
hectoliters for the balance of the year.
- Underlying COGS per hectoliter are expected to be higher in
full year 2024 as compared to full year 2023. This is due to
expected continued, albeit moderating inflation, mix impacts from
the wind down of contract brewing volume and a lower volume
leverage impact as compared to full year 2023.
- MG&A expense is expected to be lower than 2023 in the
second half of the year.
On July 18, 2024, our Board of Directors declared a dividend of
$0.44 per share, payable September 20, 2024, to shareholders of
record on August 30, 2024. Shareholders of exchangeable shares will
receive the CAD equivalent of dividends declared on Class A and
Class B common stock, equal to CAD 0.60 per share.
NOTES
Unless otherwise indicated in this release, all $ amounts are in
U.S. Dollars, and all quarterly comparative results are for the
Company’s second quarter ended June 30, 2024 compared to the second
quarter ended June 30, 2023. Some numbers may not sum due to
rounding.
2024 SECOND QUARTER INVESTOR CONFERENCE CALL
Molson Coors Beverage Company will conduct an earnings
conference call with financial analysts and investors at 8:30 a.m.
Eastern Time today to discuss the Company’s 2024 second quarter
results. The live webcast will be accessible via our website,
ir.molsoncoors.com. An online replay of the webcast will be
available until 11:59 p.m. Eastern Time on November 6, 2024. The
Company will post this release and related financial statements on
its website today.
OVERVIEW OF MOLSON COORS BEVERAGE COMPANY
For more than two centuries, Molson Coors Beverage Company has
been brewing beverages that unite people to celebrate all life’s
moments. From our core power brands Coors Light, Miller Lite, Coors
Banquet, Molson Canadian, Carling and Ožujsko to our above premium
brands including Madri, Staropramen, Blue Moon Belgian White and
Leinenkugel’s Summer Shandy, to our economy and value brands like
Miller High Life and Keystone, we produce many beloved and iconic
beer brands. While our Company's history is rooted in beer, we
offer a modern portfolio that expands beyond the beer aisle as
well, including flavored beverages like Vizzy Hard Seltzer, spirits
like Five Trail whiskey as well as non-alcoholic beverages. As a
business, our ambition is to be the first choice for our people,
our consumers and our customers, and our success depends on our
ability to make our products available to meet a wide range of
consumer segments and occasions.
Our reporting segments include: Americas, operating in the U.S.,
Canada and various countries in the Caribbean, Latin and South
America; and EMEA&APAC, operating in Bulgaria, Croatia, Czech
Republic, Hungary, Montenegro, the Republic of Ireland, Romania,
Serbia, the U.K., various other European countries, and certain
countries within the Middle East, Africa and Asia Pacific. In
addition to our reporting segments, we also have certain activity
that is not allocated to our reporting segments and reported as
"Unallocated", which primarily includes financing-related costs
such as interest expense and income, foreign exchange gains and
losses on intercompany balances and realized and unrealized changes
in fair value on instruments not designated in hedging
relationships related to financing and other treasury-related
activities and the unrealized changes in fair value on our
commodity swaps not designated in hedging relationships recorded
within cost of goods sold, which are later reclassified when
realized to the segment in which the underlying exposure resides.
Additionally, only the service cost component of net periodic
pension and OPEB cost is reported within each operating segment,
and all other components remain in Unallocated.
Our Imprint strategy is focused on People & Planet
initiatives that support our commitment to raising industry
standards and leaving a positive imprint on our employees,
consumers, communities and the environment. To learn more about
Molson Coors Beverage Company, visit molsoncoors.com,
MolsonCoorsOurImprint.com or on X (formerly Twitter) through
@MolsonCoors.
ABOUT MOLSON COORS CANADA INC.
Molson Coors Canada Inc. ("MCCI") is a subsidiary of Molson
Coors Beverage Company. MCCI Class A and Class B exchangeable
shares offer substantially the same economic and voting rights as
the respective classes of common shares of MCBC, as described in
MCBC’s annual proxy statement and Form 10-K filings with the U.S.
Securities and Exchange Commission. The trustee holder of the
special Class A voting stock and the special Class B voting stock
has the right to cast a number of votes equal to the number of then
outstanding Class A exchangeable shares and Class B exchangeable
shares, respectively.
FORWARD-LOOKING STATEMENTS
This press release includes “forward-looking statements” within
the meaning of the U.S. federal securities laws. Generally, the
words "expects," "intend," "goals," "plans," "believes,"
"continues," "may," "anticipate," "seek," "estimate," "outlook,"
"trends," "future benefits," "potential," "projects," "strategies,"
"implies," and variations of such words and similar expressions are
intended to identify forward-looking statements. Statements that
refer to projections of our future financial performance, our
anticipated growth and trends in our businesses, and other
characterizations of future events or circumstances are
forward-looking statements, and include, but are not limited to,
statements under the headings "CEO and CFO Perspectives" and "2024
Outlook," with respect to, among others, expectations of cost
inflation, limited consumer disposable income, consumer
preferences, overall volume and market share trends, pricing
trends, industry forces, cost reduction strategies, shipment levels
and profitability, the sufficiency of capital resources,
anticipated results, expectations for funding future capital
expenditures and operations, effective tax rate, debt service
capabilities, timing and amounts of debt and leverage levels,
Preserving the Planet and related initiatives and expectations
regarding future dividends and share repurchases. In addition,
statements that we make in this press release that are not
statements of historical fact may also be forward-looking
statements.
Although the Company believes that the assumptions upon which
its forward-looking statements are based are reasonable, it can
give no assurance that these assumptions will prove to be correct.
Important factors that could cause actual results to differ
materially from the Company’s historical experience, and present
projections and expectations are disclosed in the Company’s filings
with the Securities and Exchange Commission (“SEC”), including the
risks discussed in our filings with the SEC, including our most
recent Annual Report on Form 10-K and our Quarterly Reports on Form
10-Q. All forward-looking statements in this press release are
expressly qualified by such cautionary statements and by reference
to the underlying assumptions. You should not place undue reliance
on forward-looking statements, which speak only as of the date they
are made. We do not undertake to update forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law.
MARKET AND INDUSTRY DATA
The market and industry data used, if any, in this press release
are based on independent industry publications, customer specific
data, trade or business organizations, reports by market research
firms and other published statistical information from third
parties, including Circana (formerly Information Resources, Inc.)
for U.S. market data and Beer Canada for Canadian market data
(collectively, the “Third Party Information”), as well as
information based on management’s good faith estimates, which we
derive from our review of internal information and independent
sources. Such Third Party Information generally states that the
information contained therein or provided by such sources has been
obtained from sources believed to be reliable.
APPENDIX
STATEMENTS OF OPERATIONS - MOLSON COORS
BEVERAGE COMPANY AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(In millions, except per share data)
(Unaudited)
For the Three Months
Ended
For the Six Months
Ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Sales
$
3,838.1
$
3,871.1
$
6,887.4
$
6,645.9
Excise taxes
(585.8
)
(604.5
)
(1,038.7
)
(1,033.0
)
Net sales
3,252.3
3,266.6
5,848.7
5,612.9
Cost of goods sold
(1,922.4
)
(2,047.7
)
(3,555.3
)
(3,623.3
)
Gross profit
1,329.9
1,218.9
2,293.4
1,989.6
Marketing, general and administrative
expenses
(728.5
)
(734.9
)
(1,383.1
)
(1,349.9
)
Other operating income (expense), net
0.1
0.2
6.4
(0.3
)
Equity income (loss)
(1.9
)
4.3
(2.8
)
7.3
Operating income (loss)
599.6
488.5
913.9
646.7
Interest income (expense), net
(51.2
)
(54.6
)
(99.6
)
(113.7
)
Other pension and postretirement benefits
(costs), net
7.3
2.6
14.7
5.2
Other non-operating income (expense),
net
4.2
4.6
(3.7
)
4.8
Income (loss) before income taxes
559.9
441.1
825.3
543.0
Income tax benefit (expense)
(134.6
)
(95.0
)
(190.1
)
(123.7
)
Net income (loss)
425.3
346.1
635.2
419.3
Net (income) loss attributable to
noncontrolling interests
1.7
(3.7
)
(0.4
)
(4.4
)
Net income (loss) attributable to MCBC
$
427.0
$
342.4
$
634.8
$
414.9
Basic net income (loss) attributable to
MCBC per share
$
2.03
$
1.58
$
3.00
$
1.92
Diluted net income (loss) attributable to
MCBC per share
$
2.03
$
1.57
$
2.99
$
1.91
Weighted average shares outstanding -
basic
210.0
216.4
211.3
216.5
Weighted average shares outstanding -
diluted
210.8
217.8
212.5
217.6
Dividends per share
$
0.44
$
0.41
$
0.88
$
0.82
BALANCE SHEETS - MOLSON COORS BEVERAGE
COMPANY AND SUBSIDIARIES
Condensed Consolidated Balance
Sheets
(In millions, except par value)
(Unaudited)
As of
June 30, 2024
December 31, 2023
Assets
Current assets
Cash and cash equivalents
$
1,647.3
$
868.9
Trade receivables, net
1,073.8
757.8
Other receivables, net
130.8
121.6
Inventories, net
848.5
802.3
Other current assets, net
337.3
297.9
Total current assets
4,037.7
2,848.5
Property, plant and equipment, net
4,473.0
4,444.5
Goodwill
5,321.9
5,325.3
Other intangibles, net
12,393.5
12,614.6
Other assets
1,168.1
1,142.2
Total assets
$
27,394.2
$
26,375.1
Liabilities and equity
Current liabilities
Accounts payable and other current
liabilities
$
3,342.1
$
3,180.8
Current portion of long-term debt and
short-term borrowings
894.2
911.8
Total current liabilities
4,236.3
4,092.6
Long-term debt
6,161.5
5,312.1
Pension and postretirement benefits
455.1
465.8
Deferred tax liabilities
2,760.4
2,697.2
Other liabilities
365.2
372.3
Total liabilities
13,978.5
12,940.0
Redeemable noncontrolling interest
26.7
27.9
Molson Coors Beverage Company
stockholders' equity
Capital stock
Preferred stock, $0.01 par value
(authorized: 25.0 shares; none issued)
—
—
Class A common stock, $0.01 par value
(authorized: 500.0 shares; issued and outstanding: 2.6 shares and
2.6 shares, respectively)
—
—
Class B common stock, $0.01 par value
(authorized: 500.0 shares; issued: 213.2 shares and 212.5 shares,
respectively)
2.1
2.1
Class A exchangeable shares, no par value
(issued and outstanding: 2.7 shares and 2.7 shares,
respectively)
100.8
100.8
Class B exchangeable shares, no par value
(issued and outstanding: 9.4 shares and 9.4 shares,
respectively)
352.3
352.3
Paid-in capital
7,119.4
7,108.4
Retained earnings
7,932.4
7,484.3
Accumulated other comprehensive income
(loss)
(1,217.3
)
(1,116.3
)
Class B common stock held in treasury at
cost (20.3 shares and 13.9 shares, respectively)
(1,110.1
)
(735.6
)
Total Molson Coors Beverage Company
stockholders' equity
13,179.6
13,196.0
Noncontrolling interests
209.4
211.2
Total equity
13,389.0
13,407.2
Total liabilities and equity
$
27,394.2
$
26,375.1
CASH FLOW STATEMENTS - MOLSON COORS
BEVERAGE COMPANY AND SUBSIDIARIES
Condensed Consolidated Statements of
Cash Flows
(In millions) (Unaudited)
For the Six Months
Ended
June 30, 2024
June 30, 2023
Cash flows from operating
activities
Net income (loss) including noncontrolling
interests
$
635.2
$
419.3
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating activities
Depreciation and amortization
336.7
339.9
Amortization of debt issuance costs and
discounts
2.7
2.9
Share-based compensation
24.2
20.3
(Gain) loss on sale or impairment of
property, plant, equipment and other assets, net
(6.4
)
(1.9
)
Unrealized (gain) loss on foreign currency
fluctuations and derivative instruments, net
(28.0
)
111.6
Equity (income) loss
2.8
(7.3
)
Income tax (benefit) expense
190.1
123.7
Income tax (paid) received
(105.2
)
(78.2
)
Interest expense, excluding amortization
of debt issuance costs and discounts
110.5
118.4
Interest paid
(102.5
)
(109.4
)
Change in current assets and liabilities
and other
(165.5
)
(44.9
)
Net cash provided by (used in) operating
activities
894.6
894.4
Cash flows from investing
activities
Additions to property, plant and
equipment
(392.2
)
(335.1
)
Proceeds from sales of property, plant,
equipment and other assets
10.3
5.5
Other
0.5
(11.0
)
Net cash provided by (used in) investing
activities
(381.4
)
(340.6
)
Cash flows from financing
activities
Dividends paid
(188.4
)
(178.2
)
Payments for purchases of treasury
stock
(375.3
)
(26.7
)
Payments on debt and borrowings
(3.4
)
(6.1
)
Proceeds on debt and borrowings
863.7
7.0
Other
(11.0
)
2.1
Net cash provided by (used in) financing
activities
285.6
(201.9
)
Effect of foreign exchange rate changes on
cash and cash equivalents
(20.4
)
9.0
Net increase (decrease) in cash and cash
equivalents
778.4
360.9
Balance at beginning of year
868.9
600.0
Balance at end of period
$
1,647.3
$
960.9
SUMMARIZED SEGMENT RESULTS (hectoliter volume and $ in
millions) (Unaudited)
Americas
Q2 2024
Q2 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
YTD 2024
YTD 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
Net sales(1)
$
2,575.9
$
2,621.7
(1.7
)
$
(6.9
)
(1.5
)
$
4,721.3
$
4,560.7
3.5
$
(6.1
)
3.7
COGS(1)(2)
$
(1,525.7
)
$
(1,556.8
)
2.0
$
4.6
1.7
$
(2,841.2
)
$
(2,780.5
)
(2.2
)
$
4.0
(2.3
)
MG&A
$
(560.7
)
$
(584.1
)
4.0
$
1.8
3.7
$
(1,067.4
)
$
(1,068.8
)
0.1
$
1.6
—
Income (loss) before income taxes
$
487.1
$
487.3
—
$
(1.1
)
0.2
$
807.7
$
720.7
12.1
$
(2.4
)
12.4
Underlying income (loss) before income
taxes(3)
$
487.4
$
487.6
—
$
(1.1
)
0.2
$
808.5
$
721.5
12.1
$
(2.4
)
12.4
Financial volume(1)(4)
16.396
17.368
(5.6
)
30.306
30.304
—
Brand volume
15.670
16.895
(7.3
)
28.561
29.141
(2.0
)
EMEA&APAC
Q2 2024
Q2 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
YTD 2024
YTD 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
Net sales(1)
$
683.3
$
649.0
5.3
$
(5.3
)
6.1
$
1,138.0
$
1,059.1
7.4
$
6.5
6.8
COGS(1)(2)
$
(431.9
)
$
(433.3
)
0.3
$
3.3
(0.4
)
$
(753.5
)
$
(737.3
)
(2.2
)
$
(4.7
)
(1.6
)
MG&A
$
(167.8
)
$
(150.8
)
(11.3
)
$
1.7
(12.4
)
$
(315.7
)
$
(281.1
)
(12.3
)
$
(1.9
)
(11.6
)
Income (loss) before income taxes
$
81.2
$
64.2
26.5
$
(1.9
)
29.4
$
70.2
$
38.8
80.9
$
(3.8
)
90.7
Underlying income (loss) before income
taxes(3)
$
81.0
$
64.2
26.2
$
(1.8
)
29.0
$
63.7
$
42.4
50.2
$
(3.5
)
58.5
Financial volume(1)(4)
6.037
6.018
0.3
10.101
10.089
0.1
Brand volume
6.045
5.927
2.0
10.053
9.862
1.9
Unallocated &
Eliminations
Q2 2024
Q2 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
YTD 2024
YTD 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
Net sales
$
(6.9
)
$
(4.1
)
(68.3
)
$
(10.6
)
$
(6.9
)
(53.6
)
COGS(2)
$
35.2
$
(57.6
)
N/M
$
39.4
$
(105.5
)
N/M
Income (loss) before income taxes
$
(8.4
)
$
(110.4
)
92.4
$
5.6
87.3
$
(52.6
)
$
(216.5
)
75.7
$
1.2
75.2
Underlying income (loss) before income
taxes(3)
$
(37.2
)
$
(49.6
)
25.0
$
5.6
13.7
$
(82.2
)
$
(103.9
)
20.9
$
1.1
19.8
Financial volume
(0.003
)
(0.001
)
N/M
(0.003
)
(0.002
)
N/M
Consolidated
Q2 2024
Q2 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
YTD 2024
YTD 2023
Reported % Change
FX Impact
Constant Currency %
Change(3)
Net sales
$
3,252.3
$
3,266.6
(0.4
)
$
(12.2
)
(0.1
)
$
5,848.7
$
5,612.9
4.2
$
0.4
4.2
COGS
$
(1,922.4
)
$
(2,047.7
)
6.1
$
7.9
5.7
$
(3,555.3
)
$
(3,623.3
)
1.9
$
(0.6
)
1.9
MG&A
$
(728.5
)
$
(734.9
)
0.9
$
3.5
0.4
$
(1,383.1
)
$
(1,349.9
)
(2.5
)
$
(0.3
)
(2.4
)
Income (loss) before income taxes
$
559.9
$
441.1
26.9
$
2.6
26.3
$
825.3
$
543.0
52.0
$
(5.0
)
52.9
Underlying income (loss) before income
taxes(3)
$
531.2
$
502.2
5.8
$
2.7
5.2
$
790.0
$
660.0
19.7
$
(4.8
)
20.4
Financial volume(4)
22.430
23.385
(4.1
)
40.404
40.391
—
Brand volume
21.715
22.822
(4.9
)
38.614
39.003
(1.0
)
N/M = Not meaningful
The reported percent change and the constant currency percent
change in the above table are presented as (unfavorable)
favorable.
(1)
Includes gross inter-segment volumes,
sales and purchases, which are eliminated in the consolidated
totals.
(2)
The unrealized changes in fair value on
our commodity swaps, which are economic hedges, are recorded as
COGS within Unallocated. As the exposure we are managing is
realized, we reclassify the gain or loss to the segment in which
the underlying exposure resides, allowing our segments to realize
the economic effects of the derivative without the resulting
unrealized mark-to-market volatility.
(3)
Represents income (loss) before taxes
adjusted for non-GAAP items. See the Non-GAAP Measures and
Reconciliations section for definitions and reconciliations of
non-GAAP financial measures including constant currency.
(4)
Financial volume in hectoliters for the
Americas and EMEA&APAC segments excludes royalty volume of
0.578 million hectoliters and 0.325 million hectoliters,
respectively, for the three months ended June 30, 2024, and
excludes royalty volume of 0.645 million hectoliters and 0.250
million hectoliters, respectively, for the three months ended June
30, 2023. Financial volume in hectoliters for the Americas and
EMEA&APAC segments excludes royalty volume of 1.169 million
hectoliters and 0.543 million hectoliters, respectively, for the
six months ended June 30, 2024, and excludes royalty volume of
1.263 million hectoliters and 0.406 million hectoliters
respectively, for the six months ended June 30, 2023.
WORLDWIDE AND SEGMENT BRAND AND FINANCIAL VOLUME (in millions of
hectoliters)(Unaudited)
For the Three Months
Ended
Americas
June 30, 2024
June 30, 2023
Change
Financial Volume
16.396
17.368
(5.6
)%
Contract brewing and wholesale/factored
volume
(0.930
)
(1.611
)
(42.3
)%
Royalty volume
0.578
0.645
(10.4
)%
Sales-To-Wholesaler to Sales-To-Retail
adjustment and other(1)
(0.374
)
0.493
N/M
Total Americas Brand Volume
15.670
16.895
(7.3
)%
EMEA&APAC
June 30, 2024
June 30, 2023
Change
Financial Volume
6.037
6.018
0.3
%
Contract brewing and wholesale/factored
volume
(0.317
)
(0.341
)
(7.0
)%
Royalty volume
0.325
0.250
30.0
%
Sales-To-Wholesaler to Sales-To-Retail
adjustment and other(1)
—
—
N/M
Total EMEA&APAC Brand
Volume
6.045
5.927
2.0
%
Consolidated
June 30, 2024
June 30, 2023
Change
Financial Volume
22.430
23.385
(4.1
)%
Contract brewing and wholesale/factored
volume
(1.247
)
(1.952
)
(36.1
)%
Royalty volume
0.903
0.895
0.9
%
Sales-To-Wholesaler to Sales-To-Retail
adjustment and other
(0.371
)
0.494
N/M
Total Worldwide Brand Volume
21.715
22.822
(4.9
)%
For the Six Months
Ended
Americas
June 30, 2024
June 30, 2023
Change
Financial Volume
30.306
30.304
—
%
Contract brewing and wholesale/factored
volume
(1.800
)
(2.813
)
(36.0
)%
Royalty volume
1.169
1.263
(7.4
)%
Sales-To-Wholesaler to Sales-To-Retail
adjustment and other(1)
(1.114
)
0.387
N/M
Total Americas Brand Volume
28.561
29.141
(2.0
)%
EMEA&APAC
June 30, 2024
June 30, 2023
Change
Financial Volume
10.101
10.089
0.1
%
Contract brewing and wholesale/factored
volume
(0.591
)
(0.632
)
(6.5
)%
Royalty volume
0.543
0.406
33.7
%
Sales-To-Wholesaler to Sales-To-Retail
adjustment and other(1)
—
(0.001
)
N/M
Total EMEA&APAC Brand
Volume
10.053
9.862
1.9
%
Consolidated
June 30, 2024
June 30, 2023
Change
Financial Volume
40.404
40.391
—
%
Contract brewing and wholesale/factored
volume
(2.391
)
(3.445
)
(30.6
)%
Royalty volume
1.712
1.669
2.6
%
Sales-To-Wholesaler to Sales-To-Retail
adjustment and other
(1.111
)
0.388
N/M
Total Worldwide Brand Volume
38.614
39.003
(1.0
)%
N/M = Not meaningful
(1)
Includes gross inter-segment volumes which
are eliminated in the consolidated totals.
Worldwide brand volume (or "brand volume" when discussed by
segment) reflects owned or actively managed brands sold to
unrelated external customers within our geographic markets (net of
returns and allowances), royalty volume and our proportionate share
of equity investment worldwide brand volume calculated consistently
with MCBC owned volume. Financial volume represents owned or
actively managed brands sold to unrelated external customers within
our geographical markets, net of returns and allowances as well as
contract brewing, wholesale non-owned brand volume and
company-owned distribution volume. Contract brewing and
wholesale/factored volume is included within financial volume, but
is removed from worldwide brand volume, as this is non-owned volume
for which we do not directly control performance. Factored volume
in our EMEA&APAC segment is the distribution of beer, wine,
spirits and other products owned and produced by other companies to
the on-premise channel, which is a common arrangement in the U.K.
Royalty volume consists of our brands produced and sold by third
parties under various license and contract brewing agreements and,
because this is owned volume, it is included in worldwide brand
volume. Our worldwide brand volume definition also includes an
adjustment from Sales-to-Wholesaler ("STW") volume to
Sales-to-Retailer ("STR") volume. We believe the brand volume
metric is important because, unlike financial volume and STWs, it
provides the closest indication of the performance of our brands in
relation to market and competitor sales trends.
We also utilize COGS per hectoliter, as well as the year over
year changes in this metric, as a key metric for analyzing our
results. This metric is calculated as COGS per our unaudited
condensed consolidated statements of operations divided by
financial volume for the respective period. We believe this metric
is important and useful for investors and management because it
provides an indication of the trends of sales mix and other cost
impacts on our COGS.
NON-GAAP MEASURES AND RECONCILIATIONS
Use of Non-GAAP Measures
In addition to financial measures presented on the basis of
accounting principles generally accepted in the U.S. (“U.S. GAAP”),
we also use non-GAAP financial measures, as listed and defined
below, for operational and financial decision making and to assess
Company and segment business performance. These non-GAAP measures
should be viewed as supplements to (not substitutes for) our
results of operations presented under U.S. GAAP. We have provided
reconciliations of all historical non-GAAP measures to their
nearest U.S. GAAP measure and have consistently applied the
adjustments within our reconciliations in arriving at each non-GAAP
measure.
Our management uses these metrics to assist in comparing
performance from period to period on a consistent basis; as a
measure for planning and forecasting overall expectations and for
evaluating actual results against such expectations; in
communications with the Board of Directors, stockholders, analysts
and investors concerning our financial performance; as useful
comparisons to the performance of our competitors; and as metrics
of certain management incentive compensation calculations. We
believe these measures are used by, and are useful to, investors
and other users of our financial statements in evaluating our
operating performance.
- Underlying Income (Loss) before Income Taxes (Closest GAAP
Metric: Income (Loss) Before Income Taxes) – Measure of the
Company’s or segment's income (loss) before income taxes excluding
the impact of certain non-GAAP adjustment items from our U.S. GAAP
financial statements. Non-GAAP adjustment items include goodwill
and other intangible and tangible asset impairments, restructuring
and integration related costs, unrealized mark-to-market gains and
losses, potential or incurred losses related to certain litigation
accruals and settlements and gains and losses on sales of
non-operating assets, among other items included in our U.S. GAAP
results that warrant adjustment to arrive at non-GAAP results. We
consider these items to be necessary adjustments for purposes of
evaluating our ongoing business performance and are often
considered non-recurring. Such adjustments are subjective, involve
significant management judgment and can vary substantially from
company to company.
- Underlying COGS (Closest GAAP Metric: COGS) – Measure of
the Company’s COGS adjusted to exclude non-GAAP adjustment items
(as defined above). Non-GAAP adjustment items include the impact of
unrealized mark-to-market gains and losses on our commodity
derivative instruments, which are economic hedges, and are recorded
through COGS within Unallocated. As the exposure we are managing is
realized, we reclassify the gain or loss to the segment in which
the underlying exposure resides, allowing our segments to realize
the economic effects of the derivatives without the resulting
unrealized mark-to-market volatility. We also use underlying COGS
per hectoliter, as well as the year over year change in such
metric, as a key metric for analyzing our results. This metric is
calculated as underlying COGS divided by financial volume for the
respective period.
- Underlying MG&A (Closest GAAP Metric:
MG&A) – Measure of the Company’s MG&A expense excluding
the impact of certain non-GAAP adjustment items (as defined
above).
- Underlying net income (loss) attributable to MCBC (Closest
GAAP Metric: Net income (loss) attributable to MCBC) – Measure
of net income (loss) attributable to MCBC excluding the impact of
non-GAAP adjustment items (as defined above), the related tax
effects of non-GAAP adjustment items and certain other discrete tax
items.
- Underlying net income (loss) attributable to MCBC per
diluted share (also referred to as Underlying Diluted Earnings per
Share) (Closest GAAP Metric: Net income (loss) attributable to MCBC
per diluted share) – Measure of underlying net income (loss)
attributable to MCBC (as defined above) per diluted share. If
applicable, a reported net loss attributable to MCBC per diluted
share is calculated using the basic share count due to dilutive
shares being antidilutive. If underlying net income (loss)
attributable to MCBC becomes income excluding the impact of our
non-GAAP adjustment items, we include the incremental dilutive
shares, using the treasury stock method, into the dilutive shares
outstanding.
- Underlying effective tax rate (Closest GAAP Metric:
Effective Tax Rate) – Measure of the Company’s effective tax
rate excluding the related tax impact of pre-tax non-GAAP
adjustment items (as defined above) and certain other discrete tax
items. Discrete tax items include certain significant tax audit and
prior year reserve adjustments, impact of significant tax
legislation and tax rate changes and significant non-recurring and
period specific tax items.
- Underlying free cash flow (Closest GAAP Metric: Net Cash
Provided by (Used in) Operating Activities) – Measure of the
Company’s operating cash flow calculated as Net Cash Provided by
(Used In) Operating Activities less Additions to property, plant
and equipment, net and excluding the pre-tax cash flow impact of
certain non-GAAP adjustment items (as defined above). We consider
underlying free cash flow an important measure of our ability to
generate cash, grow our business and enhance shareholder value,
driven by core operations and after adjusting for non-GAAP
adjustment items, which can vary substantially from company to
company depending upon accounting methods, book value of assets and
capital structure.
- Underlying depreciation and amortization (Closest GAAP
Metric: Depreciation & Amortization) – Measure of the
Company’s depreciation and amortization excluding the impact of
non-GAAP adjustment items (as defined above). These adjustments
primarily consist of accelerated depreciation or amortization taken
related to the Company’s strategic exit or restructuring
activities.
- Net debt and net debt to underlying earnings before
interest, taxes, depreciation, and amortization ("underlying
EBITDA") (Closest GAAP Metrics: Cash, Debt, & Net Income
(Loss)) – Measure of the Company’s leverage calculated as net
debt (defined as current portion of long-term debt and short-term
borrowings plus long-term debt less cash and cash equivalents)
divided by the trailing twelve month underlying EBITDA. Underlying
EBITDA is calculated as Net income (loss) excluding Interest
expense (income), net, Income tax expense (benefit), depreciation
and amortization, and the impact of non-GAAP adjustment items (as
defined above). This measure is not the same as the Company’s
maximum leverage ratio as defined under its revolving credit
facility, which allows for other adjustments in the calculation of
net debt to EBITDA.
- Constant currency - Constant currency is a non-GAAP
measure utilized to measure performance, excluding the impact of
translational and certain transactional foreign currency movements,
and is intended to be indicative of results in local currency. As
we operate in various foreign countries where the local currency
may strengthen or weaken significantly versus the U.S. dollar or
other currencies used in operations, we utilize a constant currency
measure as an additional metric to evaluate the underlying
performance of each business without consideration of foreign
currency movements. We present all percentage changes for net
sales, underlying COGS, underlying MG&A and underlying income
(loss) before income taxes in constant currency and calculate the
impact of foreign exchange by translating our current period local
currency results (that also include the impact of the comparable
prior period currency hedging activities) at the average exchange
rates during the respective period throughout the year used to
translate the financial statements in the comparable prior year
period. The result is the current period results in U.S. dollars,
as if foreign exchange rates had not changed from the prior year
period. Additionally, we exclude any transactional foreign currency
impacts, reported within the other non-operating income (expense),
net line item, from our current period results.
Our guidance for any of the measures noted above are also
non-GAAP financial measures that exclude or otherwise have been
adjusted for non-GAAP adjustment items from our U.S. GAAP financial
statements. When we provide guidance for any of the various
non-GAAP metrics described above, we do not provide reconciliations
of the U.S. GAAP measures as we are unable to predict with a
reasonable degree of certainty the actual impact of the non-GAAP
adjustment items. By their very nature, non-GAAP adjustment items
are difficult to anticipate with precision because they are
generally associated with unexpected and unplanned events that
impact our Company and its financial results. Therefore, we are
unable to provide a reconciliation of these measures without
unreasonable efforts.
RECONCILIATION TO NEAREST U.S. GAAP
MEASURES
Reconciliation by Line Item
(In millions, except per share data)
(Unaudited)
For the Three Months Ended
June 30, 2024
Cost of goods sold
Marketing, general and
administrative expenses
Income (loss) before income
taxes
Net income (loss) attributable
to MCBC
Diluted earnings per
share
Reported (U.S. GAAP)
$
(1,922.4
)
$
(728.5
)
$
559.9
$
427.0
$
2.03
Adjustments to arrive at underlying
Restructuring
—
—
(0.2
)
(0.2
)
—
(Gains) losses on other disposals
—
—
0.1
0.1
—
Unrealized mark-to-market (gains)
losses
(28.8
)
—
(28.8
)
(28.8
)
(0.14
)
Other items
—
0.4
0.2
0.2
—
Total
$
(28.8
)
$
0.4
$
(28.7
)
$
(28.7
)
$
(0.14
)
Tax effects on non-GAAP adjustments
—
—
—
6.6
0.03
Discrete tax items
—
—
—
(0.7
)
—
Underlying (Non-GAAP)
$
(1,951.2
)
$
(728.1
)
$
531.2
$
404.2
$
1.92
(In millions, except per share data)
(Unaudited)
For the Three Months Ended
June 30, 2023
Cost of goods sold
Marketing, general and
administrative expenses
Income (loss) before income
taxes
Net income (loss) attributable
to MCBC
Diluted earnings per
share
Reported (U.S. GAAP)
$
(2,047.7
)
$
(734.9
)
$
441.1
$
342.4
$
1.57
Adjustments to arrive at underlying
Restructuring
—
—
(0.2
)
(0.2
)
—
Unrealized mark-to-market (gains)
losses
62.7
—
60.8
60.8
0.28
Other items
—
0.7
0.5
0.5
—
Total
$
62.7
$
0.7
$
61.1
$
61.1
$
0.28
Tax effects on non-GAAP adjustments
—
—
—
(15.5
)
(0.07
)
Discrete tax items
—
—
—
(0.8
)
—
Underlying (Non-GAAP)
$
(1,985.0
)
$
(734.2
)
$
502.2
$
387.2
$
1.78
(In millions, except per share data)
(Unaudited)
For the Six Months Ended June
30, 2024
Cost of goods sold
Marketing, general and
administrative expenses
Income (loss) before income
taxes
Net income (loss) attributable
to MCBC
Diluted earnings per
share
Reported (U.S. GAAP)
$
(3,555.3
)
$
(1,383.1
)
$
825.3
$
634.8
$
2.99
Adjustments to arrive at underlying
Restructuring
—
—
(1.1
)
(1.1
)
(0.01
)
(Gains) losses on other disposals
—
—
(5.3
)
(5.3
)
(0.02
)
Unrealized mark-to-market (gains)
losses
(29.6
)
—
(29.6
)
(29.6
)
(0.14
)
Other items
—
0.9
0.7
0.7
—
Total
$
(29.6
)
$
0.9
$
(35.3
)
$
(35.3
)
$
(0.17
)
Tax effects on non-GAAP adjustments
—
—
—
8.2
0.04
Discrete tax items
—
—
—
(0.7
)
—
Underlying (Non-GAAP)
$
(3,584.9
)
$
(1,382.2
)
$
790.0
$
607.0
$
2.86
In millions, except per share data)
(Unaudited)
For the Six Months Ended June
30, 2023
Cost of goods sold
Marketing, general and
administrative expenses
Income (loss) before income
taxes
Net income (loss) attributable
to MCBC
Diluted earnings per
share
Reported (U.S. GAAP)
$
(3,623.3
)
$
(1,349.9
)
$
543.0
$
414.9
$
1.91
Adjustments to arrive at underlying
Restructuring
—
—
0.3
0.3
—
Unrealized mark-to-market (gains)
losses
114.5
—
112.6
112.6
0.52
Other items
—
4.3
4.1
4.1
0.02
Total
$
114.5
$
4.3
$
117.0
$
117.0
$
0.54
Tax effects on non-GAAP adjustments
—
—
—
(27.6
)
(0.13
)
Discrete tax Items
—
—
—
(0.8
)
—
Underlying (Non-GAAP)
$
(3,508.8
)
$
(1,345.6
)
$
660.0
$
503.5
$
2.31
Reconciliation to Underlying Income
(Loss) Before Income Taxes by Segment
(In millions) (Unaudited)
For the Three Months Ended
June 30, 2024
Americas
EMEA&APAC
Unallocated
Consolidated
Income (loss) before income
taxes
$
487.1
$
81.2
$
(8.4
)
$
559.9
Add/Less:
Cost of goods sold(1)
—
—
(28.8
)
(28.8
)
Marketing, general &
administrative
0.5
(0.1
)
—
0.4
Other non-GAAP adjustment items
(0.2
)
(0.1
)
—
(0.3
)
Total non-GAAP adjustment items
$
0.3
$
(0.2
)
$
(28.8
)
$
(28.7
)
Underlying income (loss) before income
taxes
$
487.4
$
81.0
$
(37.2
)
$
531.2
In millions) (Unaudited)
For the Three Months Ended
June 30, 2023
Americas
EMEA&APAC
Unallocated
Consolidated
Income (loss) before income
taxes
$
487.3
$
64.2
$
(110.4
)
$
441.1
Add/Less:
Cost of goods sold(1)
—
—
62.7
62.7
Marketing, general &
administrative
0.5
0.2
—
0.7
Other non-GAAP adjustment items
(0.2
)
(0.2
)
(1.9
)
(2.3
)
Total non-GAAP adjustment items
$
0.3
$
—
$
60.8
$
61.1
Underlying income (loss) before income
taxes
$
487.6
$
64.2
$
(49.6
)
$
502.2
(In millions) (Unaudited)
For the Six Months Ended June
30, 2024
Americas
EMEA&APAC
Unallocated
Consolidated
Income (loss) before income
taxes
$
807.7
$
70.2
$
(52.6
)
$
825.3
Add/Less:
Cost of goods sold(1)
—
—
(29.6
)
(29.6
)
Marketing, general &
administrative
1.0
(0.1
)
—
0.9
Other non-GAAP adjustment items
(0.2
)
(6.4
)
—
(6.6
)
Total non-GAAP adjustment items
$
0.8
$
(6.5
)
$
(29.6
)
$
(35.3
)
Underlying income (loss) before income
taxes
$
808.5
$
63.7
$
(82.2
)
$
790.0
(In millions) (Unaudited)
For the Six Months Ended June
30, 2023
Americas
EMEA&APAC
Unallocated
Consolidated
Income (loss) before income
taxes
$
720.7
$
38.8
$
(216.5
)
$
543.0
Add/Less:
Cost of goods sold(1)
—
—
114.5
114.5
Marketing, general &
administrative
1.0
3.3
—
4.3
Other non-GAAP adjustment items
(0.2
)
0.3
(1.9
)
(1.8
)
Total non-GAAP adjustment items
$
0.8
$
3.6
$
112.6
$
117.0
Underlying income (loss) before income
taxes
$
721.5
$
42.4
$
(103.9
)
$
660.0
(1)
Reflects changes in our mark-to-market
positions on our derivative hedges recorded as COGS within
Unallocated. As the exposure we are managing is realized, we
reclassify the gain or loss to the segment in which the underlying
exposure resides, allowing our segments to realize the economic
effects of the derivative without the resulting unrealized
mark-to-market volatility.
Underlying Free Cash Flow
(In millions) (Unaudited)
For the Six Months
Ended
June 30, 2024
June 30, 2023
U.S. GAAP Net Cash Provided by (Used
In) Operating Activities
$
894.6
$
894.4
Add/Less:
Additions to property, plant and
equipment, net(1)
(392.2
)
(335.1
)
Cash impact of non-GAAP adjustment
items(2)
2.6
10.4
Non-GAAP Underlying Free Cash
Flow
$
505.0
$
569.7
(1)
Included in net cash provided by (used in)
investing activities.
(2)
Included in net cash provided by (used in)
operating activities and primarily reflects costs paid for
restructuring activities for the six months ended June 30, 2024 and
June 30, 2023.
Net Debt and Net Debt to Underlying EBITDA Ratio
(In millions except net debt to underlying
EBITDA ratio) (Unaudited)
As of
June 30, 2024
June 30, 2023
U.S. GAAP Current portion of long-term
debt and short-term borrowings
$
894.2
$
423.2
Add/Less:
Long-term debt
6,161.5
6,191.9
Cash and cash equivalents
1,647.3
960.9
Net debt
5,408.4
$
5,654.2
Q2 Underlying EBITDA
750.1
725.2
Q1 Underlying EBITDA
476.2
388.4
Q4 Underlying EBITDA
566.1
555.5
Q3 Underlying EBITDA
742.9
593.5
Non-GAAP Underlying EBITDA(1)
$
2,535.3
$
2,262.6
Net debt to underlying EBITDA
ratio
2.13
2.50
(1)
Represents underlying EBITDA on a trailing
twelve month basis.
Underlying EBITDA Reconciliation
(In millions) (Unaudited)
For the Three Months
Ended
June 30, 2024
June 30, 2023
U.S. GAAP Net income (loss)
425.3
346.1
Add/Less:
Interest expense (income), net
51.2
54.6
Income tax expense (benefit)
134.6
95.0
Depreciation and amortization
167.7
168.4
Adjustments included in underlying
income(1)
(28.7
)
61.1
Non-GAAP Underlying EBITDA
$
750.1
$
725.2
(1)
Includes adjustments to income (loss)
before income taxes related to non-GAAP adjustment items. See
Reconciliations to Nearest U.S. GAAP Measures by Line Item table
for detailed adjustments.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240806604516/en/
Investor Relations Traci Mangini, (415) 308-0151
News Media Rachel Dickens, (314) 452-9673
Molson Coors Canada (TSX:TPX.A)
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