US – Molson Coors, a leading brewing and drink company, has reported a 17.4% rise in net sale revenue for Q2 ending June 30th , as aggressive pursuit of the beyond the beer aisle strategy start paying off.
According to a report by FoodBev, Molson Coors sales surged to US$2.94 billion in what it described as the firm’s best second-quarter topline growth in over a decade.
The company which owns Miller Lite and Carling beer brands claimed that its increased sale volumes were primarily due to higher financial volumes, with North America seeing a 1.8% growth and Europe rising by 17.8%.
“This quarter represents the best results we have had since implementing our revitalisation plan nearly two years ago, and it delivered the most topline growth of any quarter in over a decade,” said Molson Coors CEO, Gavin Hattersley.
“We’ve reached the point where the investments, partnerships, and product launches that were byproducts of the revitalisation plan are now bearing results, and we plan to put our foot even more firmly on the gas pedal as we drive towards sustainable top-and bottom-line growth for this business.”
Molson Coors also saw its net earnings nearly double those of 2020 to reach US$388.6 million, while underlying EBITDA decreased by 1.3% to reach US$697.8 million due to a rise in marketing investment for its core brands and new products.
11 economy brands set for retire
Meanwhile, Molson Coors has said that it will discontinue 11 of its economy brands and about 100 SKUs as the next step in its efforts to prune its portfolio and retarget its business.
According to a report in AdAge, the brands that will sunset include Milwaukee’s Best Premium (but not its ice and light varieties) and Mickey’s Fine Malt Liquor Ice (but not the core brand).
Other brands set to retire include Henry Weinhard’s Private Reserve, Keystone Ice, Hamm’s Special Light, Keylightful (a fruity line extension of Keystone Light), Icehouse Edge, Magnum, Miller High Life Light, Steel Reserve 211 and Olde English HG 8000.
This move should come as no surprise, considering Molson Coors’ consistent efforts to change its strategy and turn around its sales.
According to CEO Hattersley, the company plans to invest more into its global hard seltzer portfolio and permanently streamline a smaller portfolio of legacy brands.
This leaves no room for economy brands which continue to perform poorly as consumers become more interested in other beverage options — both alcoholic and non-alcoholic.
Moving more toward premium drinks has been a strategy employed by others in the alcohol space. In 2019, Constellation Brands sold a large economy wines portfolio for more than $1 billion to E. & J. Gallo Winery.
British brewing and spirits giant Diageo has also sold several lower-tier spirits brands to Sazerac for US$550 million and is pursuing an M&A strategy focused on bringing more premium brands into its fold.
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