E-Malt.com News article: 1352

Brewer Adolph Coors Co. announced on July 24 that quarterly profits rose on a lower tax rate, overcoming sluggish U.S. beer sales that were hampered by poor weather in many parts of the country, according to Reuters. The Golden, Colorado, company, which makes Keystone and Killian's beer in addition to its trademark brand, said second-quarter profit rose to $76.3 million, or $2.09 per share, from $67.6 million, or $1.84 a share, last year. Net sales, after excise taxes, rose 5 % to $1.1 billion. Excluding excise taxes, sales rose to $1.47 billion from $1.36 billion. Shares rose more than 1 %.

"Our operating income declined 4.1 percent as a result of challenges in both of our major business segments," Coors Brewing Company President and Chief Executive Leo Kiely said in a statement. "Lower Americas sales-to-retail reflected a very soft U.S. beer industry, which was hindered by poor weather in many parts of the country and general economic weakness."

Shares of Coors closed down 33 cents at $49.60 on the New York Stock Exchange. Analysts had expected the company to report earnings per share between $1.74 and $2.11, with a mean estimate of $1.90, according to Reuters Research, a unit of Reuters Group Plc.

The company said a shifting sales mix, as customers in the Americas and Europe buy inexpensive and less profitable products, will continue to be a challenge. "Coors is not showing the improving U.S. topline trends we expected at the start of the year, and the U.K. business is showing less ... earnings strength than we anticipated at the start of the year," Legg Mason analyst Mark Swartzberg said in a research report.

The brewer's tax rate fell to 25.8 % in the second quarter because of a favorable resolution of several tax audits and the structure of its Coors Brewers Ltd. acquisition. The tax rate for full year 2003 is expected to be in the range of 31 % to 32 %, with the longer-term rate closer to 36 percent, the company said. U.S. domestic sales-to-retail for the second quarter fell about 1.9 % from the same period a year ago.


25 July, 2003