Beer giant Molson Coors tops Q1 earnings estimates

Yahoo Finance's Allie Canal discusses quarterly earnings for Molson Coors.

影片文字轉錄稿

- Welcome back to Yahoo Finance. Molson Coors on the tape. Company reporting earnings and shares are down 3 and 1/2%. That's despite the 17% bump in net sales for the quarter. And yet again, spiked seltzer in view as some question if the pre-pandemic sizzle is all fizzle. That was my right. Let's bring in Yahoo Finance's Alexandra Canale for more. You like that Alexandra?

ALEXANDRA CANALE: I do. And you know what, I might just use it a little later. The hard seltzer boom is fizzling, but Molson Coors, known for their beer, they're doing very, very well. They performed incredibly well in the first quarter, beating on the top and bottom lines, posting revenue of $2.21 billion, along with an adjusted earnings of $0.29 per share. CEO Gavin Hattersley said this is the most quarterly top line growth this company has had in more than 10 years.

The beer giant also reaffirmed its 2022 guidance for both top and bottom line growth. Although it did cite inflation as a top concern for the rest of the year, along with the pandemic. We know that inflation has hit virtually every company out there right now. But Molson Coors says that they've been able to battle inflationary pressures by balancing its, quote, "strong prices and sales mix." And one interesting thing to know, as you alluded to, Brian, is the success of its hard seltzer brand Topo Chico.

This continues to be the largest growth in hard seltzers among the major brewers. And we know this brand in particular has been a big focus for Molson Coors after the company discontinued its Coors Light hard seltzer brand just last year. At that time, the company did double down on the fact that the hard seltzer boom is here to stay despite the, quote, unquote, "fizzle," I'm going to quote you, Brian Cheung, that we've seen in the category overall.

And then if we take a look at this chart from a recent Bank of America note, you'll see the dip that hard seltzer has had. It sank 2.5% year over year, with all key players seeing volume levels shrink. However, the exception there being Mark Antony brands, the owner of White Claw, in addition to Molson Coors. So strong quarter for them overall and pretty impressive that they've been able to maintain their stake in the hard seltzer category.

- Allie Canale staying on top of the drinks for us today. Thanks so much for that. I'd add a comment, Brian. But we're talking to two people at Yahoo Finance who don't drink.

- Well, I mean, for what it's worth, I used to. During the pandemic, I kind of stopped. I just figured, you know, I feel healthier without it. But at the same time, I think with the hard seltzer itself, it's just the vodka soda. That is really what it is. And also, there's so many brands. And this is a story we've explored at length even before the pandemic. There are just too many brands out there now. Topo Chico, do you really need--

- Well, what happened to this growth that we were talking about in non-alcoholic drinks?

- Well, that's certainly true. I mean, obviously soft drinks and that's when you kind of have a built bigger universe of company competiong in that space.

- Or non-alcoholic beer.

- Right. PepsiCo and obviously Coca-Cola very much in the conversation on that front. But I mean, you've seen some of those companies go into hard seltzers as well though. So that suggests that maybe that market for non-alcoholic drinks maybe isn't the final frontier for those companies.

- I think it's strong. I single handedly feel like there's so much more options when you go to restaurants. I mean, I know we're talking about specific brands. But that's it for me in terms of the alcohol conversation. The two least qualified people to talk about this. Let's just look at markets.