Second Quarter 2016 Highlights(1)
-
Worldwide beer volume: 16.1 million hectoliters, decreased
0.8%; Coors Light volume increased 4.1% worldwide and
low-single-digits in the U.S.
-
Net sales: $986.2 million, decreased 1.9% on a reported basis,
and increased 1.9% in constant currency
-
Net sales per HL: $114.96, decreased 1.4%, and increased 2.4%
in constant currency
-
U.S. GAAP net income from continuing operations
attributable to MCBC: $174.1 million ($0.81 per diluted share),
decreased 24.1%
-
Underlying after-tax income: $239.5 million ($1.11 per diluted
share), decreased 9.2%
-
Underlying EBITDA (earnings before interest, taxes,
depreciation and amortization): $428.7 million, decreased 5.8%
First Half 2016 Highlights(1)
-
Worldwide beer volume: 27.8 million hectoliters, unchanged from
a year ago; Coors Light volume increased 3.8% worldwide and
low-single-digits in the U.S.
-
Net sales: $1,643.4 million, decreased 3.7% on a reported
basis, and increased 1.2% in constant currency
-
Net sales per HL: $114.70, decreased 4.1%, and increased 0.6%
in constant currency
-
U.S. GAAP net income from continuing operations
attributable to MCBC: $333.4 million ($1.59 per diluted share),
increased 8.1%
-
Underlying after-tax income: $349.8 million ($1.66 per diluted
share), unchanged from a year ago
-
Underlying EBITDA (earnings before interest, taxes,
depreciation and amortization): $692.1 million, increased 1.2%
DENVER & MONTREAL--(BUSINESS WIRE)--
Molson Coors Brewing Company (NYSE: TAP; TSX: TPX) today reported U.S.
GAAP net income from continuing operations attributable to MCBC of
$174.1 million, a 24.1 percent decrease versus a year ago, primarily due
to non-cash special charges and other non-core costs related to our
pending MillerCoors acquisition; alcohol prohibition in Bihar, India;
and planned brewery closures, along with significantly higher sales and
marketing expenses in the quarter. The Company also reported a 9.2
percent decrease in underlying after-tax income for the second quarter
2016, driven by lower worldwide volume, higher brand investments, and
negative foreign currency movements, which were partially offset by
positive mix, lower underlying net interest expense and higher
underlying U.S. equity income.
Molson Coors president and chief executive officer Mark Hunter said, “In
the second quarter, we continued to focus on our First Choice ambition
and on building a stronger, broader and more premium brand portfolio,
underpinned by incremental sales and marketing investments, as we
discussed on our first quarter earnings call. Progress in the quarter
included net sales revenue per hectoliter growth on a constant currency
basis in all of our businesses, strong Coors Light growth globally,
improved core brand momentum, fast-growing innovations in key markets,
and strong above-premium growth globally. We significantly increased
investments behind our brands, although the timing of shipments and
other short-term factors held back bottom-line performance in the
quarter. In brands, Coors Light grew volume more than 4 percent globally
-- including strong double-digit growth in Europe and Latin America --
and low single-digit growth in the U.S., its best performance here in
nearly three years. As a testament to our First Choice approach,
MillerCoors achieved for the first time in its history, the number-one
position in the Tamarron Supplier Survey, which polls hundreds of U.S.
distributors across all alcohol beverage suppliers."
Mark added, "In the past few months, we have also made substantial
progress on the pending MillerCoors transaction, including integration
planning and completing the necessary financing at very attractive
rates. Investor demand for our recent debt offering was very strong, and
we achieved record and near-record low interest rates on our debt issue.
We are pleased with the transaction progress made to date, and we
continue to plan for a closing before the end of 2016. We are very
excited to be much closer to completing this game-changing transaction,
which will allow us to simplify decision-making and reduce the
complexities of dual ownership; it will help us to become a more
integrated and efficient brewer; and it will enable us to become a more
effective competitor as a single owner, promoting consumer choice in an
increasingly diverse and fast-growing brewing industry. As part of the
integration planning process, last week we announced some leadership
appointments that will strengthen our combined organization and that
will take effect upon the close of the transaction. Our transaction and
its timing remain dependent on the completion of the ABI/SABMiller
transaction."
Operating and Underlying Free Cash Flow
U.S. GAAP net cash provided by operating activities through
the second quarter of 2016 was $264.4 million which represents an
increase of $66.3 million from prior year driven by higher cash paid for
pension contributions in 2015, partially offset by higher cash paid for
taxes and interest and lower net income in the first half of 2016.
Underlying free cash flow through the second quarter of 2016 was
$158.9 million. This represents a decrease of $82.2 million from the
prior year, primarily driven by lower underlying after-tax income,
negative foreign currency, and a decreased benefit from working capital
changes when excluding special and other non-core items, including
higher cash paid for taxes.
Foreign Exchange
The Company’s second quarter underlying consolidated pretax income
includes the negative effect of foreign currency movements totaling $5.6
million. Negative currency impacts in the quarter were $2.2 million in
Europe, $1.9 million in Canada, $1.2 million in Corporate and $0.3
million in International.
Effective Income Tax Rates
The Company’s second quarter effective income tax rate was 10.8 percent
on a reported basis and 19.5 percent on an underlying basis. The effective
tax rate on a reported basis decreased from prior year primarily
driven by tax benefits recognized from costs resulting from the pending
acquisition, favorable tax treatment associated with the sale of the
Vancouver brewery, as well as higher net discrete tax benefits in 2016.
The underlying effective tax rate was slightly higher than prior
year primarily due to changes in the geographic mix of income.
Debt
Total debt at the end of the second quarter was $3.027 billion,
and cash and cash equivalents totaled $2.990 billion, resulting in net
debt of $37.0 million, which is significantly lower than the prior
year primarily due to the proceeds received from our February 2016
equity offering. Note that the June 30, 2016, balance sheet does not
include approximately $6.9 billion of debt and related proceeds from the
multi-currency debt offering, which closed on July 7, 2016.
Second Quarter Business Segment Results
The following are the Company’s second quarter 2016 results by business
segment:
United States Business (MillerCoors)(2)
In our U.S. segment, reported equity income decreased 6.6 percent
to $191.9 million in the second quarter of 2016 compared to the prior
year, primarily driven by lower volume and our portion of higher special
charges of $16.5 million related to the planned closure of the Eden
brewery.
Underlying U.S. segment equity income increased 1.4 percent to
$208.4 million in the quarter, due to Molson Coors' $11.1 million
anticipated refund of federal excise tax paid on imports. This tax
refund is based on qualifying volumes exported from the U.S. by Coors
Brewing Company, a wholly-owned subsidiary of Molson Coors, and was
driven by new legislation enacted this year in the U.S.
MillerCoors Operating and Financial Highlights
MillerCoors domestic sales-to-retailers volume (STRs) declined 1.7
percent for the quarter. Domestic sales-to-wholesalers volume (STWs)
decreased 4.4 percent. Domestic net revenue per hectoliter, which
excludes contract brewing and company-owned-distributor sales, grew 0.7
percent due to favorable net pricing and positive sales mix. Total
company net revenue per hectoliter, including contract brewing and
company-owned-distributor sales, increased 0.6 percent. Contract brewing
volumes decreased 1.3 percent.
Cost of goods sold (COGS) per hectoliter decreased 1.3 percent, driven
by supply chain cost savings and lower aluminum and fuel pricing. These
factors were partially offset by brewery inflation and lower fixed-cost
absorption due to lower volumes. Marketing, general and administrative
(MG&A) expense increased 1.8 percent, driven primarily by higher
marketing investments and employee-related expenses.
Reported MillerCoors net income for the quarter decreased
11.8 percent to $429.5 million, driven by $39.4 million of higher
special charges related to the planned closure of the Eden brewery,
partially offset by the drivers discussed below. Underlying net income
for the quarter decreased 3.8 percent to $468.8 million, driven by the
timing of shipments due to year-over-year calendar shifts, partially
offset by lower cost of goods sold, higher net pricing and positive
sales mix.
Depreciation and amortization expenses for MillerCoors were $116.0
million in the second quarter, which include the accelerated
depreciation related to the planned closure of the Eden brewery of $33.0
million. Additions to tangible and intangible assets totaled $90.9
million in the second quarter.
Canada Business
STRs decreased 0.1 percent on a reported basis in the second quarter.
Molson Coors Canada sales volume decreased 0.8 percent in the second
quarter. Net sales per hectoliter increased 1.2 percent in local
currency, driven primarily by positive pricing.
COGS per hectoliter increased 6.1 percent in local currency, due to
input cost inflation, higher in-pack promotion expenses, foreign
currency movements and impacts from volume deleverage, partially offset
by cost savings initiatives. MG&A expense increased 9.2 percent in local
currency, driven by higher brand investments, partially offset by lower
overhead costs.
Canada income from continuing operations before income taxes on a
reported basis decreased by 16.6 percent to $88.5 million in the second
quarter of 2016 compared to the prior year, due to higher brand
investments and input cost inflation, partially offset by lower special
charges and results of cost savings initiatives.
Canada underlying pretax income decreased 21.3 percent to $89.9
million in the quarter driven by higher brand investments and input cost
inflation, partially offset by results of cost savings initiatives.
Foreign currency movements negatively impacted earnings by $1.9 million.
On a constant-currency basis, underlying pretax income decreased 19.7
percent.
Europe Business
Europe sales volume increased 1.6 percent, driven by the addition of the
Staropramen and Rekorderlig brands in the U.K. this year. Europe net
sales per hectoliter increased 1.3 percent in local currency, due to
positive brand and geographic mix, partially offset by negative net
pricing in the quarter.
COGS per hectoliter increased 2.2 percent in local currency, driven by
mix shift to higher-cost brands and geographies. MG&A expense increased
6.0 percent in local currency, due to higher marketing investments and
brand amortization expenses.
Europe income from continuing operations before income taxes on a
reported basis increased 20.4 percent to $59.0 million in the second
quarter of 2016, primarily driven by $16.8 million of lower special
charges related to decreased net contract termination charges and
brewery closure costs in 2016 compared to 2015, partially offset by the
drivers discussed below.
Europe underlying pretax income decreased 10.0 percent to $61.3
million in the quarter, due to higher brand investments and amortization
expenses, lower net pension benefit, the termination of the Heineken
contract brewing arrangement in the U.K., and unfavorable foreign
currency movements, partially offset by higher sales volume and cost
savings. Foreign currency movements negatively impacted underlying
results by $2.2 million.
International Business
Total International sales volume, including royalty volume, decreased
9.3 percent, driven by the enactment of total alcohol prohibition in
Bihar, India, the transfer of Staropramen in the U.K. to our Europe
segment, along with the volume impact of our China restructuring. These
factors were largely offset by a strong double-digit volume increase for
Coors Light, led by Latin America, including our launch in Colombia, as
well as volume growth in Japan. Net sales per hectoliter increased 42.5
percent, driven by lower price promotion expense in China and favorable
sales mix changes this year.
COGS per hectoliter increased 25.5 percent, due to sales mix changes.
International MG&A expense increased 3.2 percent, due to higher brand
investments.
The International segment reported a loss from continuing
operations before income taxes of $33.4 million in the second quarter of
2016, compared to $12.2 million in the prior year, primarily driven by
impairment charges related to the enactment of total alcohol prohibition
in Bihar during the second quarter of 2016, partially offset by the
drivers discussed below.
The International underlying pretax loss of $2.6 million in the
second quarter, versus a loss of $5.8 million a year ago, improved due
to volume growth in Latin America and Japan and favorable sales mix, as
well as lower price promotion and overhead expenses due to the
substantial restructure of our China business last year, which resulted
in a $3.6 million price promotion expense a year ago. Foreign currency
movements negatively impacted underlying pretax results by $0.3 million
in the second quarter.
Corporate
Corporate pretax loss on a reported basis was $109.1 million in
the second quarter versus $58.4 million in the prior year, primarily due
to costs related to the pending MillerCoors acquisition, including $19.6
million of transaction costs recorded within marketing, general and
administrative expenses; $31.8 million recorded within other income
(expense); and $13.3 million of costs recorded within interest expense,
net. Additionally, Corporate cost of goods sold included $13.0 million
of gains related to unrealized mark-to-market adjustments for commodity
swaps, compared to $4.2 million of losses in the prior year.
Underlying Corporate pretax loss totaled $57.4 million for the
second quarter versus a $54.2 million loss in the prior year, driven by
unfavorable foreign currency movements and higher commercial investments.
Special and Other Non-Core Items(3)
The following special and other non-core items have been excluded
from underlying results:
During the quarter, Molson Coors recognized a net special charge
of $34.5 million, primarily driven by non-cash asset impairment charges
associated with the enactment of total alcohol prohibition in Bihar,
India. We also recognized asset abandonment costs of $1.4 million in
Canada related to the planned closure of the Vancouver brewery and $2.5
million in Europe related to the closure of our Burton South and Plovdiv
breweries.
During the quarter, MillerCoors recognized special charges of $39.4
million related to the planned closure of the Eden, North Carolina,
brewery. Our proportionate share of the special charges is $16.5 million.
Additionally, during the quarter we recorded net other non-core charges
of $51.7 million, which was driven by costs incurred in connection with
the pending Acquisition of MillerCoors and the Miller global
brand portfolio, which were slightly offset by unrealized mark-to-market
net gains on commodity hedges.
2016 Second Quarter Conference Call
Molson Coors Brewing Company will conduct an earnings conference call
with financial analysts and investors at 11:00 a.m. Eastern Time today
to discuss the Company’s 2016 second quarter results. The Company will
provide a live webcast of the earnings call.
The Company will also host an online, real-time webcast of an Investor
Relations Follow-up Session with financial analysts and institutional
investors at 1:00 p.m. Eastern Time. Both webcasts will be accessible
via the Company’s website, www.molsoncoors.com.
Online replays of the webcasts will be available until 11:59 p.m.
Eastern Time on November 1, 2016. The Company will post this release and
related financial statements on its website today.
Upcoming Investor Webcast
The Company will host an online, real-time webcast in September at the
following event:
Mark Hunter, Molson Coors President and CEO and Mauricio Restrepo,
Molson Coors CFO, will present at the Barclays Global Consumer Staples
Conference in Boston on Wednesday, September 7, 2016, at 9:00 a.m.
Eastern Time. A live webcast of this investor event will be accessible
via the Molson Coors Brewing Company website, www.molsoncoors.com,
on the Investors page. An online replay of the presentation webcast will
be available on the website within two hours after the presentation.
Footnotes:
(1) The Company calculates non-GAAP underlying pretax and
after-tax income, underlying effective tax rate, underlying EBITDA and
underlying free cash flow results by excluding special and other
non-core items from the nearest U.S. GAAP performance measure, which is
net income from continuing operations attributable to MCBC for both
underlying after-tax income and underlying EBITDA and net cash provided
by operating activities for underlying free cash flow. In addition,
constant-currency results exclude the impact of foreign currency
movements. For further details regarding these adjustments, please see
the section “Special and Other Non-Core Items,” along with tables for
reconciliations to the nearest U.S. GAAP measures. Unless otherwise
indicated, all $ amounts are in U.S. Dollars, and all quarterly
comparative results are for the Company’s second quarter and first half
ended June 30, 2016, compared to the second quarter and first half ended
June 30, 2015. Additionally, all per-hectoliter calculations exclude
contract brewing and non-owned factored beverage volume in the
denominator but include the financial impact of these sales in the
numerator, unless otherwise indicated. Some numbers may not sum due to
rounding.
(2) MillerCoors, a U.S. joint venture of Molson Coors Brewing
Company and SABMiller plc, was launched on July 1, 2008. Molson Coors
has a 42 percent economic interest in MillerCoors, which is accounted
for using the equity method. Molson Coors’ interest in MillerCoors
results, along with certain adjustments under U.S. GAAP, is reflected in
“Equity Income in MillerCoors.” This release includes reconciliation
from MillerCoors Net Income to Molson Coors Brewing Company Equity
Income in MillerCoors and Non-GAAP U.S. Segment Underlying Pretax Income
(see Table 6). On November 11, 2015, we entered into a purchase
agreement to acquire all of SABMiller’s 58 percent interest in
MillerCoors and all trademarks, contracts and other assets primarily
related to the Miller brand portfolio outside of the U.S. and Puerto
Rico. Following the closing of the pending acquisition, the Company will
own 100 percent of the outstanding equity and voting interests of
MillerCoors. Unless otherwise indicated, MillerCoors per-hectoliter
results include contract brewing volume in the denominator of the
calculation, as well as the financial impact of these sales in the
numerator.
(3) See table 2 for the impact of specials and other non-core
items by segment.
Overview of Molson Coors
Molson Coors Brewing Company is a leading international brewer
delivering extraordinary brands that delight the world's beer drinkers.
It brews, markets and sells a portfolio of leading brands such as Coors
Light, Molson Canadian, Carling, Staropramen and Blue Moon across The
Americas, Europe and Asia. It operates in Canada through Molson Coors
Canada; in the US through MillerCoors; across Europe through Molson
Coors Europe; and outside these core markets through Molson Coors
International. The company is the only alcohol producer currently
recognized for world class sustainability performance through the Dow
Jones Sustainability Index. It was listed on the World Index for the
past four years and named global Beverage Sector Leader in 2012 and
2013. For more information on Molson Coors Brewing Company, visit the
company's website, http://molsoncoors.com
or http://ourbeerprint.com.
About Molson Coors Canada Inc.
Molson Coors Canada Inc. (MCCI) is a subsidiary of Molson Coors Brewing
Company. MCCI Class A and Class B exchangeable shares offer
substantially the same economic and voting rights as the respective
classes of common shares of MCBC, as described in MCBC’s annual proxy
statement and Form 10-K filings with the U.S. Securities and Exchange
Commission. The trustee holder of the special Class A voting stock and
the special Class B voting stock has the right to cast a number of votes
equal to the number of then outstanding Class A exchangeable shares and
Class B exchangeable shares, respectively.
Forward-Looking Statements
This press release includes estimates or projections that constitute
“forward-looking statements” within the meaning of the U.S. federal
securities laws. Generally, the words “believe,” "expect,”
"intend,” "anticipate,” “project,” “will,” and similar expressions
identify forward-looking statements, which generally are not historic in
nature. Although the Company believes that the assumptions upon
which its forward-looking statements are based are reasonable, it can
give no assurance that these assumptions will prove to be correct.
Important factors that could cause actual results to differ materially
from the Company’s historical experience, and present projections and
expectations are disclosed in the Company’s filings with the Securities
and Exchange Commission (“SEC”). These factors include, among
others, our ability to successfully close, finance and integrate the
acquisition of MillerCoors; our ability to achieve expected tax
benefits, accretion and cost synergies; impact of increased competition
resulting from further consolidation of brewers, competitive pricing and
product pressures; health of the beer industry and our brands in our
markets; economic conditions in our markets; additional impairment
charges; our ability to maintain manufacturer/distribution agreements;
changes in our supply chain system; availability or increase in the cost
of packaging materials; success of our joint ventures; risks relating to
operations in developing and emerging markets; changes in legal and
regulatory requirements, including the regulation of distribution
systems; fluctuations in foreign currency exchange rates; increase in
the cost of commodities used in the business; the impact of climate
change and the availability and quality of water; loss or closure of a
major brewery or other key facility; our ability to implement our
strategic initiatives, including executing and realizing cost savings;
our ability to successfully integrate newly acquired businesses; pension
plan costs; failure to comply with debt covenants or deterioration in
our credit rating; our ability to maintain good labor relations; our
ability to maintain brand image, reputation and product quality; lack of
full-control over the operations of MillerCoors and other risks
discussed in our filings with the SEC, including our most recent Annual
Report on Form 10-K. All forward-looking statements in this press
release are expressly qualified by such cautionary statements and by
reference to the underlying assumptions. You should not place undue
reliance on forward-looking statements, which speak only as of the date
they are made. We do not undertake to update forward-looking
statements, whether as a result of new information, future events or
otherwise.
Use of Non-GAAP Measures
In addition to financial measures presented on the basis of accounting
principles generally accepted in the U.S. ("U.S. GAAP"), we also present
pretax and after-tax "underlying income," "underlying income per diluted
share," "underlying effective tax rate," and "underlying free cash
flow," which are non-GAAP measures and should be viewed as supplements
to (not substitutes for) our results of operations presented under
U.S. GAAP. We also present underlying earnings before interest, taxes,
depreciation, and amortization ("underlying EBITDA") as a non-GAAP
measure. Our management uses underlying income, underlying income per
diluted share, underlying EBITDA, and underlying effective tax rate as
measures of operating performance, as well as underlying free cash flow
in the measure of cash generated from core operations, to assist in
comparing performance from period to period on a consistent basis; as a
measure for planning and forecasting overall expectations and for
evaluating actual results against such expectations; in communications
with the board of directors, stockholders, analysts and investors
concerning our financial performance; as useful comparisons to the
performance of our competitors; and as metrics of certain management
incentive compensation calculations. We believe that underlying income,
underlying income per diluted share, underlying EBITDA, and underlying
effective tax rate performance are used by, and are useful to, investors
and other users of our financial statements in evaluating our operating
performance, as well as underlying free cash flow in evaluating our
generation of cash from core operations, because they provide an
additional tool to evaluate our performance without regard to special
and non-core items, which can vary substantially from company to company
depending upon accounting methods and book value of assets and capital
structure. In addition to the reasons discussed above, we consider
underlying free cash flow an important measure of our ability to
generate cash, grow our business and enhance shareholder value, driven
by core operations and after adjusting for non-core items. For
discussion and analysis of our liquidity, see the unaudited condensed
consolidated statements of cash flows and the Liquidity and Capital
Resources section of our Management’s Discussion and Analysis of
Financial Condition and Results of Operations in our latest Form 10-K
and 10-Q filings with the SEC. We have provided reconciliations of all
non-GAAP measures to their nearest U.S. GAAP measure and have
consistently applied the adjustments within our reconciliations in
arriving at each non-GAAP measure. These adjustments consist of special
items from our U.S. GAAP financial statements as well as other non-core
items, such as acquisition and integration related costs, unrealized
mark-to-market gains and losses, and gains and losses on sales of
non-operating assets, included in our U.S. GAAP results that warrant
adjustment to arrive at non-GAAP results. We consider these items to be
necessary adjustments for purposes of evaluating our ongoing business
performance and are often considered non-recurring. Such adjustments are
subjective and involve significant management judgment.
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Reconciliations to Nearest U.S. GAAP
Measure
Molson Coors Brewing Company and Subsidiaries
Table 1: Underlying After-Tax Income
($ In millions, except per share data)
(Unaudited)
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|
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Three Months Ended
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Six Months Ended
|
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June 30, 2016
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June 30, 2015
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June 30, 2016
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June 30, 2015
|
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U.S. GAAP: Net income
attributable to MCBC from continuing operations
|
$
|
174.1
|
|
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$
|
229.3
|
|
|
$
|
333.4
|
|
|
$
|
308.5
|
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Per diluted share
|
$
|
0.81
|
|
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$
|
1.23
|
|
|
$
|
1.59
|
|
|
$
|
1.65
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Add/(less):
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Special items, net(1)
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34.5
|
|
|
33.7
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|
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(74.1
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)
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|
42.3
|
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42% of MillerCoors special items, net of tax(2)
|
16.5
|
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—
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32.0
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—
|
|
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Unrealized mark-to-market (gains) and losses(3)
|
(13.0
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)
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4.2
|
|
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(15.3
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)
|
|
4.1
|
|
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Acquisition and integration related costs(4)
|
64.7
|
|
|
—
|
|
|
118.4
|
|
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—
|
|
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Tax effects on special and non-GAAP items(5)
|
(37.3
|
)
|
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(3.4
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)
|
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(44.6
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)
|
|
(5.0
|
)
|
|
Non-GAAP: Underlying
after-tax income
|
$
|
239.5
|
|
|
$
|
263.8
|
|
|
$
|
349.8
|
|
|
$
|
349.9
|
|
|
Per diluted share
|
$
|
1.11
|
|
|
$
|
1.41
|
|
|
$
|
1.66
|
|
|
$
|
1.87
|
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(1)
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See Part I—Item 1. Financial Statements, Note 6, "Special Items" of
the Form 10-Q for detailed discussion of special items. Special
items for the three and six months ended June 30, 2016, include
accelerated depreciation expense of $3.3 million and $6.3 million,
respectively, related to the closures of our Vancouver brewery in
Canada and Burton South brewery in the U.K. Special items for the
three and six months ended June 30, 2015, includes accelerated
depreciation expense of $16.6 million and $28.4 million,
respectively, related to the closure of the Alton brewery in the
U.K, the closure of a bottling line within the Toronto brewery, and
the restructuring of our business in China. These accelerated
depreciation charges are included in our adjustments to arrive at
underlying EBITDA in the table below.
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(2)
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MillerCoors special items for three and six months ended June 30,
2016, include our proportionate share of accelerated depreciation
expense of $13.8 million and $28.9 million, respectively, related to
the closure of our Eden brewery which is included in our adjustments
to arrive at underlying EBITDA related to our investment in
MillerCoors in the table below. The tax effect related to our share
of MillerCoors special items in 2016 was immaterial. The flow
through MCBC tax impacts of MillerCoors special items, if
applicable, are presented within the tax effect on special and
non-GAAP items in the above reconciliation of underlying income
table.
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(3)
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The unrealized changes in fair value on our commodity swaps, which
are economic hedges, are recorded as cost of goods sold within our
Corporate business activities. As the exposure we are managing is
realized, we reclassify the gain or loss to the segment in which the
underlying exposure resides, allowing our segments to realize the
economic effects of the derivative without the resulting unrealized
mark-to-market volatility. The amounts included for the three and
six months ended June 30, 2016, and June 30, 2015, include the
unrealized mark-to-market on these commodity swaps.
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(4)
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In connection with the pending Acquisition, for the three and six
months ended June 30, 2016, we have recorded $19.6 million and $34.5
million, respectively, of transaction related costs recorded within
marketing, general & administrative expenses, $31.8 million and
$50.2 million, respectively, of derivative losses and financing
costs related to our bridge loan within other income (expense), and
$13.3 million and $33.7 million, respectively, of financing costs
related to our term loan, losses on our swaptions, and interest
income related to our fixed rate deposit and money market accounts
within interest income (expense) net. These interest income
(expense) items are included in our adjustments to arrive at
underlying EBITDA in the table below.
|
|
|
|
|
|
(5)
|
|
The effect of taxes on the adjustments used to arrive at underlying
income, a non-GAAP measure, is calculated based on applying the
estimated underlying full-year effective tax rate to actual
underlying earnings, excluding special and non-core items. The
effect of taxes on special and non-core items is calculated based on
the statutory tax rate applicable to the item being adjusted for in
the jurisdiction from which each adjustment arises. Additionally,
included in this line item is any applicable flow through MCBC tax
impacts of MillerCoors special items.
|
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 2: Underlying Pretax Income (Loss)(1)
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Business
|
|
Total
|
|
|
|
Canada
|
|
U.S.
|
|
Europe
|
|
MCI
|
|
Corporate
|
|
Consolidated
|
|
U.S. GAAP: 2016 Q2 income
(loss) from continuing operations before income taxes
|
|
$
|
88.5
|
|
|
$
|
191.9
|
|
|
$
|
59.0
|
|
|
$
|
(33.4
|
)
|
|
$
|
(109.1
|
)
|
|
$
|
196.9
|
|
|
Add/(less):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items, net
|
|
1.4
|
|
|
—
|
|
|
2.3
|
|
|
30.8
|
|
|
—
|
|
|
34.5
|
|
|
42% of MillerCoors special items, net of tax
|
|
—
|
|
|
16.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16.5
|
|
|
Unrealized mark-to-market (gains) and losses
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13.0
|
)
|
|
(13.0
|
)
|
|
Acquisition and integration related costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
64.7
|
|
|
64.7
|
|
|
Non-GAAP: 2016 Q2
underlying pretax income (loss)
|
|
$
|
89.9
|
|
|
$
|
208.4
|
|
|
$
|
61.3
|
|
|
$
|
(2.6
|
)
|
|
$
|
(57.4
|
)
|
|
$
|
299.6
|
|
|
Percent change 2016 Q2 vs. 2015 Q2 underlying pretax income (loss)
|
|
(21.3
|
)%
|
|
1.4
|
%
|
|
(10.0
|
)%
|
|
55.2
|
%
|
|
(5.9
|
)%
|
|
(8.6
|
)%
|
|
U.S. GAAP: 2015 Q2 income
(loss) from continuing operations before income taxes
|
|
$
|
106.1
|
|
|
$
|
205.5
|
|
|
$
|
49.0
|
|
|
$
|
(12.2
|
)
|
|
$
|
(58.4
|
)
|
|
$
|
290.0
|
|
|
Add/(less):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items, net
|
|
8.2
|
|
|
—
|
|
|
19.1
|
|
|
6.4
|
|
|
—
|
|
|
33.7
|
|
|
Unrealized mark-to-market (gains) and losses
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.2
|
|
|
4.2
|
|
|
Non-GAAP: 2015 Q2
underlying pretax income (loss)
|
|
$
|
114.3
|
|
|
$
|
205.5
|
|
|
$
|
68.1
|
|
|
$
|
(5.8
|
)
|
|
$
|
(54.2
|
)
|
|
$
|
327.9
|
|
(1) See notes in Table 1 for further detail of adjusting items.
|
|
|
|
|
|
|
|
|
Business
|
|
Total
|
|
|
|
Canada
|
|
U.S.
|
|
Europe
|
|
MCI
|
|
Corporate
|
|
Consolidated
|
|
U.S. GAAP: 2016 Q2 YTD
income (loss) from continuing operations before income taxes
|
|
$
|
235.1
|
|
|
$
|
334.3
|
|
|
$
|
57.8
|
|
|
$
|
(35.7
|
)
|
|
$
|
(213.9
|
)
|
|
$
|
377.6
|
|
|
Add/(less):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items, net
|
|
(107.9
|
)
|
|
—
|
|
|
3.0
|
|
|
30.8
|
|
|
—
|
|
|
(74.1
|
)
|
|
42% of MillerCoors special items, net of tax
|
|
—
|
|
|
32.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32.0
|
|
|
Unrealized mark-to-market (gains) and losses
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15.3
|
)
|
|
(15.3
|
)
|
|
Acquisition and integration related costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
118.4
|
|
|
118.4
|
|
|
Non-GAAP: 2016 Q2 YTD
underlying pretax income (loss)
|
|
$
|
127.2
|
|
|
$
|
366.3
|
|
|
$
|
60.8
|
|
|
$
|
(4.9
|
)
|
|
$
|
(110.8
|
)
|
|
$
|
438.6
|
|
|
Percent change 2016 Q2 YTD vs. 2015 Q2 YTD underlying pretax
income (loss)
|
|
(12.4
|
)%
|
|
9.4
|
%
|
|
(16.3
|
)%
|
|
56.3
|
%
|
|
0.6
|
%
|
|
2.0
|
%
|
|
U.S. GAAP: 2015 Q2 YTD
income (loss) from continuing operations before income taxes
|
|
$
|
137.0
|
|
|
$
|
334.8
|
|
|
$
|
44.9
|
|
|
$
|
(17.6
|
)
|
|
$
|
(115.6
|
)
|
|
$
|
383.5
|
|
|
Add/(less):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special items, net
|
|
8.2
|
|
|
—
|
|
|
27.7
|
|
|
6.4
|
|
|
—
|
|
|
42.3
|
|
|
Unrealized mark-to-market (gains) and losses
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.1
|
|
|
4.1
|
|
|
Non-GAAP: 2015 Q2 YTD
underlying pretax income (loss)
|
|
$
|
145.2
|
|
|
$
|
334.8
|
|
|
$
|
72.6
|
|
|
$
|
(11.2
|
)
|
|
$
|
(111.5
|
)
|
|
$
|
429.9
|
|
(1) See notes in Table 1 for further detail of adjusting items.
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 3: Underlying EBITDA
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
% change
|
|
June 30, 2016
|
|
June 30, 2015
|
|
% change
|
|
U.S. GAAP: Net income
attributable to MCBC from continuing operations
|
$
|
174.1
|
|
|
$
|
229.3
|
|
|
(24.1
|
)%
|
|
$
|
333.4
|
|
|
$
|
308.5
|
|
|
8.1
|
%
|
|
Add: Net income (loss) attributable to noncontrolling
interests
|
1.6
|
|
|
2.3
|
|
|
(30.4
|
)%
|
|
2.4
|
|
|
3.8
|
|
|
(36.8
|
)%
|
|
U.S. GAAP: Net income
(loss) from continuing operations
|
$
|
175.7
|
|
|
231.6
|
|
|
(24.1
|
)%
|
|
$
|
335.8
|
|
|
$
|
312.3
|
|
|
7.5
|
%
|
|
Add: Interest expense (income), net
|
40.5
|
|
|
30.6
|
|
|
32.4
|
%
|
|
87.8
|
|
|
59.8
|
|
|
46.8
|
%
|
|
Add: Income tax expense (benefit)
|
21.2
|
|
|
58.4
|
|
|
(63.7
|
)%
|
|
41.8
|
|
|
71.2
|
|
|
(41.3
|
)%
|
|
Add: Depreciation and amortization
|
70.2
|
|
|
81.4
|
|
|
(13.8
|
)%
|
|
137.7
|
|
|
158.9
|
|
|
(13.3
|
)%
|
|
Adjustments included in underlying income(1)
|
86.2
|
|
|
37.9
|
|
|
127.4
|
%
|
|
29.0
|
|
|
46.4
|
|
|
(37.5
|
)%
|
|
Adjustments to arrive at underlying EBITDA(2)
|
(16.6
|
)
|
|
(16.6
|
)
|
|
—
|
%
|
|
(40.0
|
)
|
|
(28.4
|
)
|
|
40.8
|
%
|
|
Adjustments to arrive at underlying EBITDA related to our investment
in MillerCoors(3)
|
51.5
|
|
|
32.0
|
|
|
60.9
|
%
|
|
100.0
|
|
|
63.7
|
|
|
57.0
|
%
|
|
Non-GAAP: Underlying EBITDA
|
$
|
428.7
|
|
|
$
|
455.3
|
|
|
(5.8
|
)%
|
|
$
|
692.1
|
|
|
$
|
683.9
|
|
|
1.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Includes adjustments to non-GAAP underlying income within the table
above related to special and non-core items.
|
|
|
|
|
|
(2)
|
|
Represents adjustments to remove amounts related to interest,
depreciation and amortization included in the adjustments to
non-GAAP underlying income above, as these items are added back as
adjustments to net income attributable to MCBC from continuing
operations.
|
|
|
|
|
|
(3)
|
|
Adjustments to our equity income from MillerCoors, which include our
proportionate share of MillerCoors' interest, income tax,
depreciation and amortization, special items, and amortization of
the difference between the MCBC contributed cost basis and
proportionate share of the underlying equity in net assets of
MillerCoors.
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 4: Underlying Free Cash Flow
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
U.S. GAAP:
|
|
Net Cash Provided by Operating Activities
|
$
|
264.4
|
|
|
$
|
198.1
|
|
|
Less:
|
|
Additions to properties(1)
|
(121.6
|
)
|
|
(139.8
|
)
|
|
Less:
|
|
Investment in MillerCoors(1)
|
(810.6
|
)
|
|
(758.1
|
)
|
|
Add:
|
|
Return of capital from MillerCoors(1)
|
731.1
|
|
|
692.9
|
|
|
Add/(Less):
|
|
Cash impact of special items(2)
|
4.0
|
|
|
17.5
|
|
|
Add:
|
|
Costs related to acquisition of businesses(3)
|
90.6
|
|
|
—
|
|
|
Add:
|
|
Discretionary pension contribution(4)
|
—
|
|
|
227.1
|
|
|
Add:
|
|
MillerCoors investments in businesses(5)
|
—
|
|
|
3.4
|
|
|
Add:
|
|
MillerCoors cash impact of special items(5)
|
1.0
|
|
|
—
|
|
|
Non-GAAP:
|
|
Underlying Free Cash Flow
|
$
|
158.9
|
|
|
$
|
241.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Included in net cash used in investing activities.
|
|
|
|
|
|
(2)
|
|
Included in net cash provided by operating activities and primarily
reflects termination fees received and paid, as well as costs paid
for brewery closures and restructuring activities. Also, includes
additions to properties within net cash used in investing activities
related to the cash paid to build a new efficient and flexible
brewery in British Columbia, following the sale of our Vancouver
brewery in the first quarter of 2016. The proceeds of $140.8 million
received from the sale of the Vancouver brewery are being used to
fund the construction of the new brewery in British Columbia.
|
|
|
|
|
|
(3)
|
|
Included in net cash provided by operating activities and reflects
costs paid associated with the pending Acquisition of 58% of
MillerCoors, LLC, and the Miller global brand portfolio, including
$38.8 million of cash paid for income taxes.
|
|
|
|
|
|
(4)
|
|
Discretionary cash contribution of $227.1 million made to our U.K.
pension plan in 2015 included in net cash provided by operating
activities.
|
|
|
|
|
|
(5)
|
|
Amounts represent our proportionate 42% share of the cash flow
impacts.
|
|
|
|
|
|
|
|
|
|
|
|
MillerCoors LLC
Table 5: Underlying Net Income Attributable to
MillerCoors
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
U.S. GAAP: Net income
attributable to MillerCoors
|
|
$
|
429.5
|
|
|
$
|
487.2
|
|
|
$
|
764.8
|
|
|
$
|
791.8
|
|
Add: Special items, net of tax
|
|
39.3
|
|
|
—
|
|
|
76.1
|
|
|
—
|
|
Non-GAAP: Underlying net
income attributable to MillerCoors
|
|
$
|
468.8
|
|
|
$
|
487.2
|
|
|
$
|
840.9
|
|
|
$
|
791.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 6: Underlying Equity Income in MillerCoors
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
U.S. GAAP: Net Income
Attributable to MillerCoors
|
|
$
|
429.5
|
|
|
$
|
487.2
|
|
|
$
|
764.8
|
|
|
$
|
791.8
|
|
|
Multiply: MCBC economic interest
|
|
42
|
%
|
|
42
|
%
|
|
42
|
%
|
|
42
|
%
|
|
MCBC proportionate share of MillerCoors net income
|
|
$
|
180.4
|
|
|
$
|
204.6
|
|
|
$
|
321.2
|
|
|
$
|
332.6
|
|
|
Add: Amortization of the difference between MCBC contributed
cost basis and proportionate share of the underlying equity in net
assets of MillerCoors(1)
|
|
1.1
|
|
|
1.3
|
|
|
2.2
|
|
|
2.4
|
|
|
Add: Share-based compensation adjustment(2)
|
|
(0.7
|
)
|
|
(0.4
|
)
|
|
(0.2
|
)
|
|
(0.2
|
)
|
|
Add: U.S. import tax benefit(3)
|
|
11.1
|
|
|
—
|
|
|
11.1
|
|
|
—
|
|
|
U.S. GAAP: Equity Income in
MillerCoors
|
|
$
|
191.9
|
|
|
$
|
205.5
|
|
|
$
|
334.3
|
|
|
$
|
334.8
|
|
|
Add: MCBC proportionate share of MillerCoors special items,
net of tax
|
|
16.5
|
|
|
—
|
|
|
32.0
|
|
|
—
|
|
|
Non-GAAP: Underlying Equity
Income in MillerCoors
|
|
$
|
208.4
|
|
|
$
|
205.5
|
|
|
$
|
366.3
|
|
|
$
|
334.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Our net investment in MillerCoors is based on the carrying values of
the net assets contributed to the joint venture, which is less than
our proportionate share of underlying equity (42%) of MillerCoors
(contributed by both Coors Brewing Company and Miller Brewing
Company) by $654.8 million as of June 30, 2016. This basis
difference, with the exception of certain non-amortizing items
(goodwill, land, etc.), is being amortized as additional equity
income over the remaining useful lives of the contributed long-lived
amortizing assets.
|
|
|
|
|
|
(2)
|
|
The net adjustment is to eliminate all share-based compensation
impacts related to pre-existing SABMiller plc equity awards held by
former Miller employees employed by MillerCoors, as well as to add
back all share-based compensation impacts related to pre-existing
MCBC equity awards held by former MCBC employees who transferred to
MillerCoors.
|
|
|
|
|
|
(3)
|
|
Represents an $11.1 million benefit associated with an anticipated
refund to Coors Brewing Company ("CBC"), a wholly-owned subsidiary
of Molson Coors, of U.S. federal excise tax paid on products
imported by CBC based on qualifying volumes exported by CBC from the
U.S. Due to administrative restrictions outlined within the
legislation enacted in 2016, the anticipated refund is not expected
to be received until 2018. Accordingly, the anticipated refund
amount represents a non-current receivable which has been recorded
within other non-current assets on the unaudited condensed
consolidated balance sheet as of June 30, 2016.
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 7: Constant Currency Results: Constant
Currency Reporting Net Sales, U.S. GAAP Pretax Income and
Underlying Pretax Income
(Unaudited)
U.S. GAAP: Net Sales (In millions)
|
|
|
|
|
|
Three Months Ended
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Reported %
Increase
(Decrease)
|
|
Foreign
Exchange
Impact ($)
|
|
Constant Currency
% Increase
(Decrease)
|
|
Canada
|
$
|
425.9
|
|
|
$
|
444.9
|
|
|
(4.3
|
)%
|
|
$
|
(20.5
|
)
|
|
0.3
|
%
|
|
Europe
|
522.1
|
|
|
524.8
|
|
|
(0.5
|
)%
|
|
(18.6
|
)
|
|
3.0
|
%
|
|
MCI
|
39.2
|
|
|
37.2
|
|
|
5.4
|
%
|
|
0.4
|
|
|
4.3
|
%
|
|
Corporate
|
0.2
|
|
|
0.1
|
|
|
100.0
|
%
|
|
—
|
|
|
100.0
|
%
|
|
Eliminations(1)
|
(1.2
|
)
|
|
(1.3
|
)
|
|
7.7
|
%
|
|
—
|
|
|
7.7
|
%
|
|
MCBC Consolidated Total
|
$
|
986.2
|
|
|
$
|
1,005.7
|
|
|
(1.9
|
)%
|
|
$
|
(38.7
|
)
|
|
1.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Reflects intercompany sales from Europe to MCI, and the offset is
included within MCI cost of goods sold. These amounts are eliminated
in the consolidated totals.
|
|
|
|
|
|
|
|
|
U.S. GAAP: Pretax Income (In millions)
|
|
|
|
|
|
Three Months Ended
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Reported %
Increase
(Decrease)
|
|
Foreign
Exchange
Impact ($)
|
|
Constant Currency
% Increase
(Decrease)
|
|
MillerCoors (42% portion)
|
$
|
191.9
|
|
|
$
|
205.5
|
|
|
(6.6
|
)%
|
|
$
|
—
|
|
|
(6.6
|
)%
|
|
Canada
|
88.5
|
|
|
106.1
|
|
|
(16.6
|
)%
|
|
(1.9
|
)
|
|
(14.8
|
)%
|
|
Europe
|
59.0
|
|
|
49.0
|
|
|
20.4
|
%
|
|
(2.1
|
)
|
|
24.7
|
%
|
|
MCI
|
(33.4
|
)
|
|
(12.2
|
)
|
|
(173.8
|
)%
|
|
1.4
|
|
|
(185.2
|
)%
|
|
Corporate
|
(109.1
|
)
|
|
(58.4
|
)
|
|
(86.8
|
)%
|
|
(12.8
|
)
|
|
(64.9
|
)%
|
|
MCBC Consolidated Total
|
$
|
196.9
|
|
|
$
|
290.0
|
|
|
(32.1
|
)%
|
|
$
|
(15.4
|
)
|
|
(26.8
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP: Underlying Pretax Income (In millions)
|
|
|
|
|
|
Three Months Ended
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Reported %
Increase
(Decrease)
|
|
Foreign
Exchange
Impact ($)
|
|
Constant Currency
% Increase
(Decrease)
|
|
MillerCoors (42% portion)
|
$
|
208.4
|
|
|
$
|
205.5
|
|
|
1.4
|
%
|
|
$
|
—
|
|
|
1.4
|
%
|
|
Canada
|
89.9
|
|
|
114.3
|
|
|
(21.3
|
)%
|
|
(1.9
|
)
|
|
(19.7
|
)%
|
|
Europe
|
61.3
|
|
|
68.1
|
|
|
(10.0
|
)%
|
|
(2.2
|
)
|
|
(6.8
|
)%
|
|
MCI
|
(2.6
|
)
|
|
(5.8
|
)
|
|
55.2
|
%
|
|
(0.3
|
)
|
|
60.3
|
%
|
|
Corporate
|
(57.4
|
)
|
|
(54.2
|
)
|
|
(5.9
|
)%
|
|
(1.2
|
)
|
|
(3.7
|
)%
|
|
MCBC Consolidated Total
|
$
|
299.6
|
|
|
$
|
327.9
|
|
|
(8.6
|
)%
|
|
$
|
(5.6
|
)
|
|
(6.9
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP: Net Sales (In millions)
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Reported %
Increase
(Decrease)
|
|
Foreign
Exchange
Impact ($)
|
|
Constant Currency
% Increase
(Decrease)
|
|
Canada
|
|
$
|
693.9
|
|
|
$
|
758.4
|
|
|
(8.5
|
)%
|
|
$
|
(48.3
|
)
|
|
(2.1
|
)%
|
|
Europe
|
|
880.8
|
|
|
882.7
|
|
|
(0.2
|
)%
|
|
(33.7
|
)
|
|
3.6
|
%
|
|
MCI
|
|
70.2
|
|
|
66.3
|
|
|
5.9
|
%
|
|
(0.2
|
)
|
|
6.2
|
%
|
|
Corporate
|
|
0.6
|
|
|
0.5
|
|
|
20.0
|
%
|
|
—
|
|
|
20.0
|
%
|
|
Eliminations(1)
|
|
(2.1
|
)
|
|
(2.2
|
)
|
|
4.5
|
%
|
|
—
|
|
|
4.5
|
%
|
|
MCBC Consolidated Total
|
|
$
|
1,643.4
|
|
|
$
|
1,705.7
|
|
|
(3.7
|
)%
|
|
$
|
(82.2
|
)
|
|
1.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Reflects intercompany sales from Europe to MCI, and the offset is
included within MCI cost of goods sold. These amounts are eliminated
in the consolidated totals.
|
|
|
|
|
|
|
|
|
U.S. GAAP: Pretax Income (In millions)
|
|
|
|
|
|
Six Months Ended
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Reported %
Increase
(Decrease)
|
|
Foreign
Exchange
Impact ($)
|
|
Constant Currency
% Increase
(Decrease)
|
|
MillerCoors (42% portion)
|
$
|
334.3
|
|
|
$
|
334.8
|
|
|
(0.1
|
)%
|
|
$
|
—
|
|
|
(0.1
|
)%
|
|
Canada
|
235.1
|
|
|
137.0
|
|
|
71.6
|
%
|
|
(8.4
|
)
|
|
77.7
|
%
|
|
Europe
|
57.8
|
|
|
44.9
|
|
|
28.7
|
%
|
|
(2.5
|
)
|
|
34.3
|
%
|
|
MCI
|
(35.7
|
)
|
|
(17.6
|
)
|
|
(102.8
|
)%
|
|
1.2
|
|
|
(109.7
|
)%
|
|
Corporate
|
(213.9
|
)
|
|
(115.6
|
)
|
|
(85.0
|
)%
|
|
(11.1
|
)
|
|
(75.4
|
)%
|
|
MCBC Consolidated Total
|
$
|
377.6
|
|
|
$
|
383.5
|
|
|
(1.5
|
)%
|
|
$
|
(20.8
|
)
|
|
3.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP: Underlying Pretax Income (In millions)
|
|
|
|
|
|
Six Months Ended
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Reported %
Increase
(Decrease)
|
|
Foreign
Exchange
Impact ($)
|
|
Constant Currency
% Increase
(Decrease)
|
|
MillerCoors (42% portion)
|
$
|
366.3
|
|
|
$
|
334.8
|
|
|
9.4
|
%
|
|
$
|
—
|
|
|
9.4
|
%
|
|
Canada
|
127.2
|
|
|
145.2
|
|
|
(12.4
|
)%
|
|
(3.3
|
)
|
|
(10.1
|
)%
|
|
Europe
|
60.8
|
|
|
72.6
|
|
|
(16.3
|
)%
|
|
(2.6
|
)
|
|
(12.7
|
)%
|
|
MCI
|
(4.9
|
)
|
|
(11.2
|
)
|
|
56.3
|
%
|
|
(0.5
|
)
|
|
60.7
|
%
|
|
Corporate
|
(110.8
|
)
|
|
(111.5
|
)
|
|
0.6
|
%
|
|
0.5
|
|
|
0.2
|
%
|
|
MCBC Consolidated Total
|
$
|
438.6
|
|
|
$
|
429.9
|
|
|
2.0
|
%
|
|
$
|
(5.9
|
)
|
|
3.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant currency is a non-GAAP measure utilized by Molson Coors
management to measure performance, excluding the impact of foreign
currency movements. As we operate in various foreign countries where the
local currency may strengthen or weaken significantly versus the U.S.
dollar or other currencies used in operations, we utilize a constant
currency measure as an additional metric to evaluate the underlying
performance of each business without consideration of foreign currency
movements. This information is non-GAAP and should be viewed as a
supplement to (not a substitute for) our reported results of operations
under U.S. GAAP. We calculate the impact of foreign exchange on net
sales, pretax income and non-GAAP underlying pretax income using the
following steps:
|
|
|
1.
|
|
Multiply our current period local currency operating results (that
also include the impact of the comparable prior-period currency
hedging activities) by the weighted average foreign exchange rates
used to translate the financial statements in the comparable prior
year period. The result is the current-period operating results in
U.S. dollars, as if foreign exchange rates had not changed from the
prior-year period.
|
|
|
|
|
|
|
|
|
|
2.
|
|
Subtract the result in step 1 from the unadjusted current-period
reported operating result in U.S. dollars (U.S. GAAP measure). This
difference reflects the impact of foreign currency translational
gains/losses included in the current-period results.
|
|
|
|
|
|
|
|
|
|
3.
|
|
Determine the amount of actual non-operating foreign currency
gains/losses realized as a result of hedging activities and
activities transacted in a currency other than the functional
currency of each legal entity.
|
|
|
|
|
|
|
|
|
|
4.
|
|
Add the results of steps 2 and 3 above. This sum equals the total
impact of foreign currency translational gains/losses and realized
gains/losses from foreign currency transactions. This is the value
shown in the “Foreign Exchange $ Impact” column within the table
above.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide Beer Volume
Molson Coors Brewing Company and Subsidiaries
Table 8: Worldwide Beer Volume
(In millions of hectoliters)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
% Change
|
|
Financial Volume
|
|
8.579
|
|
|
8.623
|
|
|
(0.5
|
)%
|
|
Royalty Volume(1)
|
|
0.521
|
|
|
0.485
|
|
|
7.4
|
%
|
|
Owned Volume
|
|
9.100
|
|
|
9.108
|
|
|
(0.1
|
)%
|
|
Proportionate Share of Equity Investment STRs(2)
|
|
7.021
|
|
|
7.145
|
|
|
(1.7
|
)%
|
|
Total Worldwide Beer Volume
|
|
16.121
|
|
|
16.253
|
|
|
(0.8
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Includes MCI segment royalty volume that is primarily in Russia,
Ukraine and Mexico, and Europe segment royalty volume in Republic
of Ireland.
|
|
|
|
|
|
(2)
|
|
Reflects the addition of Molson Coors Brewing Company's
proportionate share of equity method investments sales-to-retail for
the periods presented.
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP Measures
Molson Coors Brewing Company and Subsidiaries
Table 9: Condensed Consolidated Statements of
Operations
($ In millions, except per share data)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Volume in hectoliters
|
|
8.579
|
|
|
8.623
|
|
|
14.328
|
|
|
14.255
|
|
|
Sales
|
|
$
|
1,407.0
|
|
|
$
|
1,433.0
|
|
|
$
|
2,357.8
|
|
|
$
|
2,436.2
|
|
|
Excise taxes
|
|
(420.8
|
)
|
|
(427.3
|
)
|
|
(714.4
|
)
|
|
(730.5
|
)
|
|
Net sales
|
|
986.2
|
|
|
1,005.7
|
|
|
1,643.4
|
|
|
1,705.7
|
|
|
Cost of goods sold
|
|
(562.2
|
)
|
|
(579.9
|
)
|
|
(976.2
|
)
|
|
(1,034.7
|
)
|
|
Gross profit
|
|
424.0
|
|
|
425.8
|
|
|
667.2
|
|
|
671.0
|
|
|
Marketing, general and administrative expenses
|
|
(313.6
|
)
|
|
(283.3
|
)
|
|
(564.5
|
)
|
|
(523.9
|
)
|
|
Special items, net
|
|
(34.5
|
)
|
|
(33.7
|
)
|
|
74.1
|
|
|
(42.3
|
)
|
|
Equity income in MillerCoors
|
|
191.9
|
|
|
205.5
|
|
|
334.3
|
|
|
334.8
|
|
|
Operating income (loss)
|
|
267.8
|
|
|
314.3
|
|
|
511.1
|
|
|
439.6
|
|
|
Interest income (expense), net
|
|
(40.5
|
)
|
|
(30.6
|
)
|
|
(87.8
|
)
|
|
(59.8
|
)
|
|
Other income (expense), net
|
|
(30.4
|
)
|
|
6.3
|
|
|
(45.7
|
)
|
|
3.7
|
|
|
Income (loss) from continuing operations before income taxes
|
|
196.9
|
|
|
290.0
|
|
|
377.6
|
|
|
383.5
|
|
|
Income tax benefit (expense)
|
|
(21.2
|
)
|
|
(58.4
|
)
|
|
(41.8
|
)
|
|
(71.2
|
)
|
|
Net income (loss) from continuing operations
|
|
175.7
|
|
|
231.6
|
|
|
335.8
|
|
|
312.3
|
|
|
Income (loss) from discontinued operations, net of tax
|
|
(1.8
|
)
|
|
(0.3
|
)
|
|
(2.3
|
)
|
|
1.6
|
|
|
Net income (loss) including noncontrolling interests
|
|
173.9
|
|
|
231.3
|
|
|
333.5
|
|
|
313.9
|
|
|
Net (income) loss attributable to noncontrolling interests
|
|
(1.6
|
)
|
|
(2.3
|
)
|
|
(2.4
|
)
|
|
(3.8
|
)
|
|
Net income (loss) attributable to MCBC
|
|
$
|
172.3
|
|
|
$
|
229.0
|
|
|
$
|
331.1
|
|
|
$
|
310.1
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income (loss) attributable to MCBC per share:
|
|
|
|
|
|
|
|
|
|
From continuing operations
|
|
$
|
0.81
|
|
|
$
|
1.23
|
|
|
$
|
1.59
|
|
|
$
|
1.66
|
|
|
From discontinued operations
|
|
(0.01
|
)
|
|
—
|
|
|
(0.01
|
)
|
|
0.01
|
|
|
Basic net income (loss) attributable to MCBC per share
|
|
$
|
0.80
|
|
|
$
|
1.23
|
|
|
$
|
1.58
|
|
|
$
|
1.67
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income (loss) attributable to MCBC per share:
|
|
|
|
|
|
|
|
|
|
From continuing operations
|
|
$
|
0.81
|
|
|
$
|
1.23
|
|
|
$
|
1.59
|
|
|
$
|
1.65
|
|
|
From discontinued operations
|
|
(0.01
|
)
|
|
—
|
|
|
(0.01
|
)
|
|
0.01
|
|
|
Diluted net income (loss) attributable to MCBC per share
|
|
$
|
0.80
|
|
|
$
|
1.23
|
|
|
$
|
1.58
|
|
|
$
|
1.66
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares - basic
|
|
214.7
|
|
|
185.7
|
|
|
209.2
|
|
|
185.8
|
|
|
Weighted average shares - diluted
|
|
215.7
|
|
|
186.5
|
|
|
210.2
|
|
|
186.7
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per share
|
|
$
|
0.41
|
|
|
$
|
0.41
|
|
|
$
|
0.82
|
|
|
$
|
0.82
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts attributable to MCBC
|
|
|
|
|
|
|
|
|
|
Net income (loss) from continuing operations
|
|
$
|
174.1
|
|
|
$
|
229.3
|
|
|
$
|
333.4
|
|
|
$
|
308.5
|
|
|
Income (loss) from discontinued operations, net of tax
|
|
(1.8
|
)
|
|
(0.3
|
)
|
|
(2.3
|
)
|
|
1.6
|
|
|
Net income (loss) attributable to MCBC
|
|
$
|
172.3
|
|
|
$
|
229.0
|
|
|
$
|
331.1
|
|
|
$
|
310.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 10: Canada Results of Operations
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Volume in hectoliters
|
|
2.133
|
|
|
2.150
|
|
|
3.591
|
|
|
3.680
|
|
|
Sales
|
|
$
|
560.0
|
|
|
$
|
584.3
|
|
|
$
|
913.8
|
|
|
$
|
993.6
|
|
|
Excise taxes
|
|
(134.1
|
)
|
|
(139.4
|
)
|
|
(219.9
|
)
|
|
(235.2
|
)
|
|
Net sales
|
|
425.9
|
|
|
444.9
|
|
|
693.9
|
|
|
758.4
|
|
|
Cost of goods sold
|
|
(239.2
|
)
|
|
(238.1
|
)
|
|
(396.4
|
)
|
|
(437.4
|
)
|
|
Gross profit
|
|
186.7
|
|
|
206.8
|
|
|
297.5
|
|
|
321.0
|
|
|
Marketing, general and administrative expenses
|
|
(99.3
|
)
|
|
(95.4
|
)
|
|
(176.0
|
)
|
|
(180.1
|
)
|
|
Special items, net
|
|
(1.4
|
)
|
|
(8.2
|
)
|
|
107.9
|
|
|
(8.2
|
)
|
|
Operating income (loss)
|
|
86.0
|
|
|
103.2
|
|
|
229.4
|
|
|
132.7
|
|
|
Other income (expense), net
|
|
2.5
|
|
|
2.9
|
|
|
5.7
|
|
|
4.3
|
|
|
Income (loss) from continuing operations before income taxes
|
|
$
|
88.5
|
|
|
$
|
106.1
|
|
|
$
|
235.1
|
|
|
$
|
137.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 11: Europe Results of Operations
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Volume in hectoliters(1)
|
|
6.093
|
|
|
5.995
|
|
|
10.089
|
|
|
9.793
|
|
|
Sales(1)
|
|
$
|
800.5
|
|
|
$
|
801.4
|
|
|
$
|
1,361.4
|
|
|
$
|
1,361.1
|
|
|
Excise taxes
|
|
(278.4
|
)
|
|
(276.6
|
)
|
|
(480.6
|
)
|
|
(478.4
|
)
|
|
Net sales(1)
|
|
522.1
|
|
|
524.8
|
|
|
880.8
|
|
|
882.7
|
|
|
Cost of goods sold
|
|
(310.9
|
)
|
|
(310.9
|
)
|
|
(550.8
|
)
|
|
(547.8
|
)
|
|
Gross profit
|
|
211.2
|
|
|
213.9
|
|
|
330.0
|
|
|
334.9
|
|
|
Marketing, general and administrative expenses
|
|
(151.1
|
)
|
|
(146.2
|
)
|
|
(270.4
|
)
|
|
(263.4
|
)
|
|
Special items, net
|
|
(2.3
|
)
|
|
(19.1
|
)
|
|
(3.0
|
)
|
|
(27.7
|
)
|
|
Operating income (loss)
|
|
57.8
|
|
|
48.6
|
|
|
56.6
|
|
|
43.8
|
|
|
Interest income, net
|
|
0.9
|
|
|
1.0
|
|
|
1.7
|
|
|
2.0
|
|
|
Other income (expense), net
|
|
0.3
|
|
|
(0.6
|
)
|
|
(0.5
|
)
|
|
(0.9
|
)
|
|
Income (loss) from continuing operations before income taxes
|
|
$
|
59.0
|
|
|
$
|
49.0
|
|
|
$
|
57.8
|
|
|
$
|
44.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Gross segment sales include intercompany sales to MCI consisting of
$1.2 million of net sales and 0.013 million hectoliters and $2.1
million of net sales and 0.023 million hectoliters for the three and
six months ended June 30, 2016, respectively. Gross segment sales
include intercompany sales to MCI consisting of $1.3 million of net
sales and 0.017 million hectoliters and $2.2 million of net sales
and 0.027 million hectoliters for the three and six months ended
June 30, 2015, respectively. The offset is included within MCI cost
of goods sold. These amounts are eliminated in the consolidated
totals.
|
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 12: Molson Coors International Results of
Operations
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Volume in hectoliters(1)
|
|
0.366
|
|
|
0.495
|
|
|
0.671
|
|
|
0.809
|
|
|
Sales
|
|
$
|
47.5
|
|
|
$
|
48.5
|
|
|
$
|
84.1
|
|
|
$
|
83.2
|
|
|
Excise taxes
|
|
(8.3
|
)
|
|
(11.3
|
)
|
|
(13.9
|
)
|
|
(16.9
|
)
|
|
Net sales
|
|
39.2
|
|
|
37.2
|
|
|
70.2
|
|
|
66.3
|
|
|
Cost of goods sold(2)
|
|
(25.7
|
)
|
|
(27.7
|
)
|
|
(46.3
|
)
|
|
(46.9
|
)
|
|
Gross profit
|
|
13.5
|
|
|
9.5
|
|
|
23.9
|
|
|
19.4
|
|
|
Marketing, general and administrative expenses
|
|
(16.1
|
)
|
|
(15.6
|
)
|
|
(28.8
|
)
|
|
(30.2
|
)
|
|
Special items, net
|
|
(30.8
|
)
|
|
(6.4
|
)
|
|
(30.8
|
)
|
|
(6.4
|
)
|
|
Operating income (loss)
|
|
(33.4
|
)
|
|
(12.5
|
)
|
|
(35.7
|
)
|
|
(17.2
|
)
|
|
Other income (expense), net
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
(0.4
|
)
|
|
Income (loss) from continuing operations before income taxes
|
|
$
|
(33.4
|
)
|
|
$
|
(12.2
|
)
|
|
$
|
(35.7
|
)
|
|
$
|
(17.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Excludes royalty volume of 0.470 million hectoliters and 0.771
million hectoliters for the three and six months ended June 30,
2016, and excludes royalty volume of 0.427 million and 0.723 million
hectoliters for the three and six months ended June 30, 2015,
respectively.
|
|
|
|
|
|
(2)
|
|
Reflects gross segment amounts and for the three months ended June
30, 2016, and June 30, 2015, includes intercompany cost of goods
sold from Europe of $1.2 million and $1.3 million, respectively. The
six months ended June 30, 2016, and June 30, 2015, includes
intercompany cost of goods sold from Europe of $2.1 million and $2.2
million, respectively. The offset is included within Europe net
sales. These amounts are eliminated in the consolidated totals.
|
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 13: Corporate Results of Operations
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Volume in hectoliters
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Sales
|
|
$
|
0.2
|
|
|
$
|
0.1
|
|
|
$
|
0.6
|
|
|
$
|
0.5
|
|
|
Excise taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Net sales
|
|
0.2
|
|
|
0.1
|
|
|
0.6
|
|
|
0.5
|
|
|
Cost of goods sold
|
|
12.4
|
|
|
(4.5
|
)
|
|
15.2
|
|
|
(4.8
|
)
|
|
Gross profit
|
|
12.6
|
|
|
(4.4
|
)
|
|
15.8
|
|
|
(4.3
|
)
|
|
Marketing, general and administrative expenses
|
|
(47.1
|
)
|
|
(26.1
|
)
|
|
(89.3
|
)
|
|
(50.2
|
)
|
|
Special items, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Operating income (loss)
|
|
(34.5
|
)
|
|
(30.5
|
)
|
|
(73.5
|
)
|
|
(54.5
|
)
|
|
Interest expense, net
|
|
(41.4
|
)
|
|
(31.6
|
)
|
|
(89.5
|
)
|
|
(61.8
|
)
|
|
Other income (expense), net
|
|
(33.2
|
)
|
|
3.7
|
|
|
(50.9
|
)
|
|
0.7
|
|
|
Income (loss) from continuing operations before income taxes
|
|
$
|
(109.1
|
)
|
|
$
|
(58.4
|
)
|
|
$
|
(213.9
|
)
|
|
$
|
(115.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MillerCoors LLC (1)
Table 14: MillerCoors Results of Operations
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Volume in hectoliters(2)
|
|
19.195
|
|
|
20.002
|
|
|
35.456
|
|
|
36.103
|
|
|
Sales
|
|
$
|
2,426.3
|
|
|
$
|
2,514.3
|
|
|
$
|
4,495.6
|
|
|
$
|
4,540.1
|
|
|
Excise taxes
|
|
(299.6
|
)
|
|
(311.6
|
)
|
|
(552.8
|
)
|
|
(562.8
|
)
|
|
Net sales
|
|
2,126.7
|
|
|
2,202.7
|
|
|
3,942.8
|
|
|
3,977.3
|
|
|
Cost of goods sold
|
|
(1,174.5
|
)
|
|
(1,240.5
|
)
|
|
(2,207.5
|
)
|
|
(2,316.7
|
)
|
|
Gross profit
|
|
952.2
|
|
|
962.2
|
|
|
1,735.3
|
|
|
1,660.6
|
|
|
Marketing, general and administrative expenses
|
|
(477.1
|
)
|
|
(468.8
|
)
|
|
(886.8
|
)
|
|
(857.9
|
)
|
|
Special items, net
|
|
(39.4
|
)
|
|
—
|
|
|
(76.3
|
)
|
|
—
|
|
|
Operating income
|
|
435.7
|
|
|
493.4
|
|
|
772.2
|
|
|
802.7
|
|
|
Interest income (expense), net
|
|
(0.4
|
)
|
|
(0.4
|
)
|
|
(0.9
|
)
|
|
(0.7
|
)
|
|
Other income (expense), net
|
|
1.0
|
|
|
3.1
|
|
|
2.6
|
|
|
4.4
|
|
|
Income before income taxes
|
|
436.3
|
|
|
496.1
|
|
|
773.9
|
|
|
806.4
|
|
|
Income tax expense
|
|
(2.5
|
)
|
|
(1.6
|
)
|
|
(2.0
|
)
|
|
(2.7
|
)
|
|
Net income
|
|
433.8
|
|
|
494.5
|
|
|
771.9
|
|
|
803.7
|
|
|
Net (income) loss attributable to noncontrolling interests
|
|
(4.3
|
)
|
|
(7.3
|
)
|
|
(7.1
|
)
|
|
(11.9
|
)
|
|
Net income attributable to MillerCoors
|
|
$
|
429.5
|
|
|
$
|
487.2
|
|
|
$
|
764.8
|
|
|
$
|
791.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Economic ownership of MillerCoors is 58% held by SABMiller and 42%
held by Molson Coors. See Table 6 for a reconciliation from Net
Income Attributable to MillerCoors to Molson Coors Equity Income in
MillerCoors, and to U.S. Segment Underlying Pretax Income (Non-GAAP).
|
|
|
|
|
|
(2)
|
|
Includes contract brewing and company-owned-distributor sales, which
are excluded from our worldwide beer volume calculation.
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 15: Condensed Consolidated Balance Sheets
($ In millions, except par value)
(Unaudited)
|
|
|
|
|
|
|
|
As of
|
|
|
|
June 30, 2016
|
|
December 31, 2015
|
|
Assets
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
2,990.3
|
|
|
$
|
430.9
|
|
|
Accounts receivable, net
|
|
563.1
|
|
|
424.7
|
|
|
Other receivables, net
|
|
155.1
|
|
|
101.2
|
|
|
Inventories:
|
|
|
|
|
|
Finished
|
|
188.4
|
|
|
139.1
|
|
|
In process
|
|
17.3
|
|
|
13.0
|
|
|
Raw materials
|
|
11.1
|
|
|
18.6
|
|
|
Packaging materials
|
|
17.4
|
|
|
8.6
|
|
|
Total inventories
|
|
234.2
|
|
|
179.3
|
|
|
Other current assets, net
|
|
128.0
|
|
|
122.7
|
|
|
Total current assets
|
|
4,070.7
|
|
|
1,258.8
|
|
|
Properties, net
|
|
1,539.2
|
|
|
1,590.8
|
|
|
Goodwill
|
|
1,943.5
|
|
|
1,983.3
|
|
|
Other intangibles, net
|
|
4,928.9
|
|
|
4,745.7
|
|
|
Investment in MillerCoors
|
|
2,557.1
|
|
|
2,441.0
|
|
|
Deferred tax assets
|
|
28.1
|
|
|
20.2
|
|
|
Notes receivable, net
|
|
17.4
|
|
|
19.9
|
|
|
Other assets
|
|
237.3
|
|
|
216.6
|
|
|
Total assets
|
|
$
|
15,322.2
|
|
|
$
|
12,276.3
|
|
|
Liabilities and equity
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable and other current liabilities
|
|
$
|
1,315.6
|
|
|
$
|
1,184.4
|
|
|
Current portion of long-term debt and short-term borrowings
|
|
347.0
|
|
|
28.7
|
|
|
Discontinued operations
|
|
5.0
|
|
|
4.1
|
|
|
Total current liabilities
|
|
1,667.6
|
|
|
1,217.2
|
|
|
Long-term debt
|
|
2,680.3
|
|
|
2,908.7
|
|
|
Pension and postretirement benefits
|
|
209.1
|
|
|
201.9
|
|
|
Deferred tax liabilities
|
|
802.5
|
|
|
799.8
|
|
|
Unrecognized tax benefits
|
|
14.3
|
|
|
8.4
|
|
|
Other liabilities
|
|
63.8
|
|
|
66.9
|
|
|
Discontinued operations
|
|
12.7
|
|
|
10.3
|
|
|
Total liabilities
|
|
5,450.3
|
|
|
5,213.2
|
|
|
Molson Coors Brewing Company stockholders' equity
|
|
|
|
|
|
Capital stock:
|
|
|
|
|
|
Preferred stock, $0.01 par value (authorized: 25.0 shares; none
issued)
|
|
—
|
|
|
—
|
|
|
Class A common stock, $0.01 par value per share (authorized: 500.0
shares; issued and outstanding: 2.6 shares and 2.6 shares,
respectively)
|
|
—
|
|
|
—
|
|
|
Class B common stock, $0.01 par value per share (authorized: 500.0
shares; issued: 203.4 shares and 172.5 shares, respectively)
|
|
2.0
|
|
|
1.7
|
|
|
Class A exchangeable shares, no par value (issued and outstanding:
2.9 shares and 2.9 shares, respectively)
|
|
108.1
|
|
|
108.2
|
|
|
Class B exchangeable shares, no par value (issued and outstanding:
15.4 shares and 16.0 shares, respectively)
|
|
580.3
|
|
|
603.0
|
|
|
Paid-in capital
|
|
6,556.6
|
|
|
4,000.4
|
|
|
Retained earnings
|
|
4,650.6
|
|
|
4,496.0
|
|
|
Accumulated other comprehensive income (loss)
|
|
(1,573.9
|
)
|
|
(1,694.9
|
)
|
|
Class B common stock held in treasury at cost (9.5 shares and 9.5
shares, respectively)
|
|
(471.4
|
)
|
|
(471.4
|
)
|
|
Total Molson Coors Brewing Company stockholders' equity
|
|
9,852.3
|
|
|
7,043.0
|
|
|
Noncontrolling interests
|
|
19.6
|
|
|
20.1
|
|
|
Total equity
|
|
9,871.9
|
|
|
7,063.1
|
|
|
Total liabilities and equity
|
|
$
|
15,322.2
|
|
|
$
|
12,276.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Molson Coors Brewing Company and Subsidiaries
Table 16: Condensed Consolidated Statements of
Cash Flows
($ In millions)
(Unaudited)
|
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
June 30, 2016
|
|
June 30, 2015
|
|
Cash flows from operating activities:
|
|
|
|
|
|
Net income (loss) including noncontrolling interests
|
|
$
|
333.5
|
|
|
$
|
313.9
|
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
Depreciation and amortization
|
|
137.7
|
|
|
158.9
|
|
|
Amortization of debt issuance costs and discounts
|
|
35.5
|
|
|
2.6
|
|
|
Share-based compensation
|
|
11.5
|
|
|
8.1
|
|
|
(Gain) loss on sale or impairment of properties and other assets, net
|
|
(79.8
|
)
|
|
(3.5
|
)
|
|
Equity income in MillerCoors
|
|
(323.2
|
)
|
|
(334.8
|
)
|
|
Distributions from MillerCoors
|
|
323.2
|
|
|
334.8
|
|
|
Equity in net (income) loss of other unconsolidated affiliates
|
|
2.4
|
|
|
(1.9
|
)
|
|
Excess tax benefits from share-based compensation
|
|
(4.4
|
)
|
|
(7.6
|
)
|
|
Unrealized (gain) loss on foreign currency fluctuations and
derivative instruments, net
|
|
(5.2
|
)
|
|
4.9
|
|
|
Income tax (benefit) expense
|
|
41.8
|
|
|
71.2
|
|
|
Income tax (paid) received
|
|
(109.1
|
)
|
|
(69.0
|
)
|
|
Interest expense, excluding interest amortization
|
|
95.5
|
|
|
61.0
|
|
|
Interest paid
|
|
(95.1
|
)
|
|
(59.5
|
)
|
|
Pension expense
|
|
4.0
|
|
|
7.9
|
|
|
Pension contributions paid
|
|
(10.4
|
)
|
|
(240.2
|
)
|
|
Change in current assets and liabilities (net of impact of business
combinations) and other
|
|
(95.8
|
)
|
|
(47.1
|
)
|
|
(Gain) loss from discontinued operations
|
|
2.3
|
|
|
(1.6
|
)
|
|
Net cash provided by operating activities
|
|
264.4
|
|
|
198.1
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
Additions to properties
|
|
(121.6
|
)
|
|
(139.8
|
)
|
|
Proceeds from sales of properties and other assets
|
|
144.6
|
|
|
7.5
|
|
|
Acquisition of businesses, net of cash acquired
|
|
—
|
|
|
(51.1
|
)
|
|
Investment in MillerCoors
|
|
(810.6
|
)
|
|
(758.1
|
)
|
|
Return of capital from MillerCoors
|
|
731.1
|
|
|
692.9
|
|
|
Other
|
|
(4.1
|
)
|
|
(9.5
|
)
|
|
Net cash used in investing activities
|
|
(60.6
|
)
|
|
(258.1
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
Proceeds from issuance of common stock, net
|
|
2,525.9
|
|
|
—
|
|
|
Exercise of stock options under equity compensation plans
|
|
5.4
|
|
|
28.6
|
|
|
Excess tax benefits from share-based compensation
|
|
4.4
|
|
|
7.6
|
|
|
Dividends paid
|
|
(176.5
|
)
|
|
(152.3
|
)
|
|
Payments for purchase of treasury stock
|
|
—
|
|
|
(50.1
|
)
|
|
Debt issuance costs
|
|
(15.0
|
)
|
|
—
|
|
|
Payments on debt and borrowings
|
|
(17.9
|
)
|
|
(14.6
|
)
|
|
Proceeds on debt and borrowings
|
|
31.7
|
|
|
27.9
|
|
|
Net proceeds from (payments on) revolving credit facilities and
commercial paper
|
|
2.5
|
|
|
67.2
|
|
|
Change in overdraft balances and other
|
|
(3.9
|
)
|
|
(39.0
|
)
|
|
Net cash provided by (used in) financing activities
|
|
2,356.6
|
|
|
(124.7
|
)
|
|
Cash and cash equivalents:
|
|
|
|
|
|
Net increase (decrease) in cash and cash equivalents
|
|
2,560.4
|
|
|
(184.7
|
)
|
|
Effect of foreign exchange rate changes on cash and cash equivalents
|
|
(1.0
|
)
|
|
(26.1
|
)
|
|
Balance at beginning of year
|
|
430.9
|
|
|
624.6
|
|
|
Balance at end of period
|
|
$
|
2,990.3
|
|
|
$
|
413.8
|
|
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160802005490/en/
Source: Molson Coors Brewing Company