Shares of Molson Coors Brewing Co. (NYSE:TAP) were up 1.54% in late morning trading on December 18. The stock has declined 16.7% in 2017. Molson Coors has been weighed down by successive earnings misses. Interestingly, beer consumption among emerging young demographics has declined in recent years. The millennial generation, for example, consumes wine at a greater pace than beer and spirits.
Molson Coors released its third quarter results on November 1. Net sales dropped from $2.94 billion to $2.88 billion year over year – a 2.1% drop. Net sales in constant currency were down 3%. Canada and U.S. net sales declined 2.7% and 5.5% respectively, while European and international sales were up 6.9% and 97%.
Alcohol and event soft drink beverage companies have begun to pivot to international markets as growth as seemingly capped in many North American sectors. In the U.S., Premium Light and Below Premium segments saw lower volumes and domestic sales-to-wholesalers volume fell 7.2%.
In Canada, brand volume declined 1.7%. Positive pricing and brand mix allowed for net sales per hectolitre to rise 2% in local currency. The return of the Miller brands to the Canadian portfolio also boosted volumes to offset the broader loss.
Molson Coors Brewing offers a quarterly dividend of $0.41 per share with a 2% dividend yield. Stronger global growth as well as economic momentum in Canada and the U.S. in 2018 could see Molson Coors stock bounce back in the New Year. Investors should not write off the company because of its earnings disappointments.