Tags: Molson | Coors | Brewing | TAP

Molson Coors Looks Beyond Mature Beer Markets

By    |   Monday, 14 May 2012 09:30 PM

Molson Coors Brewing (TAP) is looking beyond mature beer markets at home to joint ventures as far afield as India and China, hoping to spark growth in an otherwise dependable but typically slow-growth sector, beer sales.

Molson Coors Brewing is the result of the 2005 merger of Canada’s Molson and Adolph Coors of the United States. The combined company operates in the regional segments of Canada, the United States, the United Kingdom, and Miller Coors International (MCI).

Signature brands include Coors Light, Molson Canadian and Carling, and regional brands under license, including Heineken, Amstel Light, Murphy’s; Asahi and Asahi Select; Miller Lite, Miller Genuine Draft, Miller Chill, Milwaukee's Best, and Milwaukee's Best Dry; and Foster's.

The company also has a joint venture with Mexico’s Grupo Modelo to import, distributes and market the Modelo beer brand portfolio, including the Corona, Coronita, Negra Modelo, and Pacifico brands, across all Canadian provinces and territories.

MillerCoors sells a wide variety of brands in the United States under premium light brands Coors Light and Miller Lite, as well as Miller High Life, Keystone, Icehouse, Mickey's, Milwaukee's Best, Hamm's, and Old English 800 brands, among others.

“We are Canada's second-largest brewer by volume and North America's oldest beer company,” management said in a recent filing. “Our approximate market share of the Canada beer market at the end of 2011 was 40 percent.”

In 2008, Molson Coors established Molson Coors International to manage the expansion of its brand portfolio outside of the company’s mature markets in the United States, Canada and the U.K. Molson Coors International now manages the growth of its brand portfolio across 47 countries.

In the past year, MCI has announced new majority-owned joint-ventures in China and India, as well as new contract brewing agreements in Spain, Russia, and Ukraine.

The company has a market cap of $6.44 billion in a sector, beverages, where the average company size is $9.56 billion. Its trailing 12-month P/E ratio is 11.38 and its five-year projected price-to-earnings-growth (PEG) ratio is 4.74, compared to 2.69 for the sector.

Its projected earnings per share growth for the coming year is 4.85 percent, compared to a sector average of 10.77 percent.

Stable revenue

Wall Street is mixed on Molson Coors, with buy or outperform calls in from Ned Davis Research and Ford Equity Research, but underperforms from Merrill Lynch and Columbine Capital Services.

“Our risk assessment reflects the stable revenue streams of the brewing industry, in which TAP is a major player, offset by our corporate governance concerns with respect to TAP's multi-class stock structure and its more than 50 percent controlling family interest,” S&P analysts wrote in a recent report.

Molson Coors next reports on Aug. 7.

© 2018 Newsmax Finance. All rights reserved.

1Like our page
Monday, 14 May 2012 09:30 PM
Newsmax Media, Inc.

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved