Higher prices drive Coors into UK profit

05 May, 2009

Molson Coors has seen its best first quarter UK profit performance in five years.

The US brewer said its made underlying pre-tax profit of $3.5 million in the first three months of the year, a turnaround from a $2 million loss a year earlier.

The performance was driven by higher prices, improved contract-brewing arrangements, reduced marketing and pension costs.

Lower volume sales and higher input cost inflation had a negative impact on the profit line.

Sales of its owned-brands – which include Carling and Coors Light – decreased 13.8%, faster than the markets 8% decline, said the brewer.

The company said it “under-performed the market as it took a firm stance with customers on pricing”.

Molson Coors’ worldwide beer volumes dropped 2.7%, but underlying post-tax profit increased 75.3% to $98.8 million.

President and chief operating officer Peter Swinburn said: “We are pleased with the bottom-lime momentum we have achieved leading into the peak summer selling season, but we nonetheless remain cautious about the rest of the year due to uncertainty around currency exchange rates and beer market volume trends, plus continuing commodity price inflation.”

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