Coors Releases ’04 Financials and Sales

The newly-formed Molson Coors Brewing Company released fourth quarter and full year performance of the Adolph Coors Company, reporting higher consolidated net sales and net income. Net sales for the full year fell, however.

In the fourth quarter 2004, net sales in the Americas segment of the company increased 9.0 percent from the fourth quarter a year ago. Fourth quarter sales volume for the segment was up 4.2 percent from a year earlier, and wholesaler sales to retail increased 1.0 percent. U.S. sales volume to wholesalers also increased 4.2 percent, while wholesaler sales to retail increased 0.8 percent compared to the same period a year ago. Sales volume to wholesalers exceeded sales to retail because the company’s distributors started the fourth quarter of 2003 with high beer inventories in anticipation of a supply-chain systems changeover for that quarter.

For the full year 2004, Americas segment net sales increased 3.0 percent from a year earlier. Americas segment sales volume for 2004 decreased 0.7 percent compared to the prior year, while sales to retail decreased 0.3 percent. U.S. sales volume and sales to retail decreased 0.8 percent and 0.2 percent, respectively, compared to full year 2003.

Company-wide, including European business, Coors reported fourth quarter net sales of $1.1 billion, up 10.2% from the fourth quarter of 2003. Fourth quarter 2004 sales volume increased 4.7% from the corresponding period in 2003.

For the full year, Coors achieved consolidated net sales of $4.3billon, a 7.6% increase. However, reported volume totaled 32,703,000 barrels in 2004, a 0.1% decrease from 2003. Net income for the full year was $196.7m, a 12.6% increase compared to full year 2003.

Leo Kiely, chief executive officer, said: “Overall, Adolph Coors Company finished 2004 with good financial results in a very competitive industry environment. In the US, despite very soft industry demand, our sales to retail increased in the fourth quarter, partially driven by the comparison to lower sales in the fourth quarter of 2003, when we faced US supply-chain challenges. Our volume trends also benefited from the introduction of Aspen Edge earlier this year and strong growth from our Blue Moon and Zima XXX brands in the fourth quarter. In addition, continued progress on productivity initiatives in our US operations enabled us to manage cost pressures, which were particularly challenging in the areas of energy and packaging materials. In Canada, our Coors Light business continued to deliver strong profit growth.

“Our UK business achieved solid growth in volume, net sales and earnings for the fourth quarter, despite higher distribution costs and continued declines in sales of flavoured alcohol beverages and non-owned beverage brands. Profit growth in our Europe segment was driven by a gain on the sale of our Cape Hill brewery property, strong volume.