US – US multinational brewing and drink company Molson Coors has recorded a 9.7% decline in first-quarter net sales as on-premise restrictions in key markets hurt sales even as the company “makes progress” against its revitalisation plan.
The maker of Coors beer brand posted net sales of US$1.9 billion in the quarter, compared to US$2.1 billion the same time last year.
The company attributed much of the decline to restrictions and closures in the on-premise channel, particularly in the UK and Canada.
Revenue decline was primarily driven by volume and brand volume declines of 12% and a 9.1% drop respectively which were partially offset by higher net pricing in North America and Europe.
According to Molson, its European business was the worst hit, as Covid-19 on-premise restrictions drove a 34.9% decrease, with financial volumes falling 22%.
Molson Coors’ North America business saw its net sales fall 5.5%, with financial volume decreasing 9.4% due to lower brand value.
Brand volumes dropped 7.3% in the US and 10.8% in Canada and were partially offset by a 10.8% brand volume growth in Latin America.
Commenting on the results, Gavin Hattersley, Molson Coors president and CEO, noted that during Q1 of 2021, the company faced three major events that had material near-term impacts on the business.
These events were a system outage caused by a cybersecurity incident, an abnormal winter storm in Texas that forced utility companies to shut off power to the Fort Worth brewery for eleven days, and government restrictions that shut down the entire on-trade channel in the UK.
“Despite these three unprecedented and disruptive events that took place in the quarter, we continued to make progress against our revitalisation plan focused on driving long-term top-line growth,” Hattersley said.
In the three months, the company says its iconic core of beers continued to gain strength – Coors Light in the US finished with the strongest category share performance since the first quarter of 2017; while Coors Banquet posted its best quarterly brand volume performance in over four years.
Molson Coors also claims to witness progress in growing its above premium portfolio; with Topo Chico Hard Seltzer jumping a 3.2% share in the US hard seltzer category in one week.
The company estimates it could reach US$1 billion in sales by 2023 from ancillary businesses such as energy drinks, CBD drinks, hard seltzer and a new distribution agreement for ready-to-drink La Colombe coffee.
In addition to strengthening its core and premium brands, Molson Coors continues to advance towards its sustainability goals and announced that it will power its entire UK operations by renewable energy.
The company expects a mid-single-digit net sales increase on a constant currency basis for the full-year.
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