Molson Coors Q2 profit falls on one-time charges
Molson Coors saw its second-quarter profit fizzle as a slew of one-time financial charges dragged down results.
The beer giant posted a profit of $80.9 million US, or 43 US cents a share, in the April to June period, a drop of 56 per cent compared with the year earlier.
Molson Coors hopes to tap into growing U.S. beer marketOverall sales were up 4.8 per cent in the quarter, reaching $1.76 billion US. The dollar value of Canadian sales, however, slipped marginally to $532.6 million US.
On a volume basis, Canadian sales fell even further, by nearly 12 per cent. Molson Coors said shifting some beer sales to a new corporate joint venture and the ending of a U.S. contract to brew Foster's explained the sales slippage.
Molson Coors, the beer behemoth that resulted from the merger of Adolph Coors Co. and Montreal's Molson Inc., also absorbed $103.9 million US in special charges in the second quarter of 2008. Included were:
$33 million in integration costs related to Miller Coors, a joint venture with SABMiller launched in July;$50 million in a non-cash charge due to the reduced value of Molson's brands in the U.S. market;$20 million in other one-time costs.Company president and CEO Peter Swinburn said Molson Coors' results should start to improve as the new joint venture with Miller begins to bear fruit.
"Miller Coors is bringing new energy to the beer industry and will drive profitable growth, which provides Molson Coors Brewing Company with important new financial resources to continue building our brands in our core markets and around the world," he said in a statement.
Three month chart for Molson CoorsOver the next 18 to 24 months, Miller Coors will work at integrating its facilities and operations in order to cut costs by a planned $500 million US annually.
Shares in Molson Coors closed Tuesday down more than 11 per cent, or $6.25, ending at $48.18 in New York.
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