DENVER—Molson Coors Brewing Co., one of the world’s largest brewers, said Tuesday its fourth-quarter income jumped 75 percent as sales rose 5 percent and it achieved additional savings from its 2005 combination with Adolph Coors Co.
The Denver-based company also credited a tax benefit and favorable exchange rates for the results, which beat Wall Street expectations. Its stock jumped 9.5 percent.
In the quarter ended Dec. 30, Molson Coors’ net income totaled $173.2 million, or 95 cents per share, compared with $99.2 million, or 57 cents a share, in the year-ago quarter.
Excluding special items, net income was 73 cents per share, beating an estimate of 65 cents a share from analysts surveyed by Thomson Financial. The analysts’ forecasts typically exclude special items.
The company received a tax benefit of $60.4 million related to changes in Canada and U.K. corporate income tax laws.
Revenue grew 5 percent to $1.6 billion, slightly higher than analyst expectations of $1.55 billion, and net sales per barrel rose 8.5 percent to $153. Sales volume fell 4 percent to 10.5 million barrels, which Molson Coors attributed to an additional week in the year-ago quarter.
Sales to retail stores climbed 5.5 percent in the United States and 0.7 percent in Canada while falling 6 percent in Europe, where the market was affected by a slowing economy and smoking bans in England, Molson Coors said.
For 2007, the company also reported cost-savings of $55 million stemming from the 2005 combination of Molson Inc. and Adolph Coors Co.
Chief Executive Officer Leo Kiely told analysts during a conference call that the company continues to provide information to the Justice Department in hopes of receiving regulatory approval for a joint venture with Milwaukee-based Miller Brewing Co. by summer. He said no decision has been made on where to base the joint venture but the company would maintain a presence in both Denver and Milwaukee.
Goldman Sachs analyst Judy Hong told clients in a research note that the results should ease concerns about the impact the weakening United Kingdom economy may have on beer sales. In addition, she expects to see additional cost savings if the joint venture is approved.
In an interview with The Associated Press, Kiely said he does not expect the slowing U.S. economy to hamper beer sales in 2008 because “beer is pretty remarkably resistant to downturns.”
For the year, net income totaled $497.2 million, or $2.74 a share, up from $361 million, or $2.08 a share in 2006. Revenue totaled $6.2 billion, up from $5.8 billion in the previous year.
Molson Coors’ stock rose $4.30 a share, or 9.5 percent, to $49.66 Tuesday.
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