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MOLSON COORS BEVERAGE CO (TAP)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 delivered mixed top-line with net sales down 2.0% YoY to $2.74B, but strong bottom-line: GAAP diluted EPS rose to $1.39 (+189.6% YoY) and underlying EPS rose to $1.30 (+9.2% YoY), aided by lower MG&A and favorable price/mix; consolidated underlying pretax income was $341M (-0.9% cc) .
  • Americas was pressured by lower U.S. volumes and the wind-down of contract brewing, while EMEA&APAC posted profit growth on price/mix despite softer volumes; Canada remained a bright spot within Americas .
  • 2025 outlook calls for low-single-digit NSR growth (cc), mid-single-digit underlying pretax income growth (cc), and high-single-digit underlying EPS growth; capital allocation remains shareholder-friendly with a 6.8% dividend increase to $0.47 and active buybacks .
  • Strategic catalysts: premiumization progress (Madrí, Peroni onshoring), non-alc expansion (ZOA consolidation), and the new Fever-Tree U.S. partnership (exclusive commercialization + ~$90M equity stake) to strengthen mix and margins over time .
  • Narrative: retention of >80% of 2023 U.S. share gains for core power brands, easing industry softness in Q4 vs summer, and margin expansion drivers (price/mix, cost savings, less contract brewing) set up 2025; watch near-term volume headwinds from contract brewing exit and competitive U.K. backdrop .

What Went Well and What Went Wrong

  • What Went Well

    • Underlying EPS +9.2% YoY and GAAP EPS +189.6% YoY in Q4, driven by favorable price/mix, lower MG&A, and tax rate; GAAP pretax income +109.2% YoY .
    • EMEA&APAC profits rose materially on price/mix (premiumization, channel) despite volume declines; underlying pretax income +54.9% cc in Q4 .
    • Strategic portfolio actions progressing: retained >80% of combined U.S. share gains for Coors Light, Miller Lite, Coors Banquet; ZOA consolidation; Fever-Tree U.S. partnership announced; Peroni onshoring to support scale and margins .

  • What Went Wrong

    • Consolidated net sales -2.0% YoY as financial volume fell 6.4% (contract brewing wind-down, lower shipments); brand volume -3.4% .
    • Americas pressured by U.S. macro softness and above-premium declines; segment net sales -2.6% and financial volume -5.9% in Q4 .
    • Competitive U.K. environment and soft demand impacted EMEA volumes (-7.8% financial volume, -6.9% brand volume) despite price/mix; consolidated COGS/hl rose 3.2% on inflation and mix .

Financial Results

Quarterly comparisons (oldest → newest)

MetricQ2 2024Q3 2024Q4 2024
Net Sales ($MM)$3,252.3 $3,042.7 $2,735.6
GAAP Diluted EPS ($)$2.03 $0.96 $1.39
Underlying Diluted EPS ($)$1.92 $1.80 $1.30
GAAP Income Before Taxes ($MM)$559.9 $331.4 $346.3
Underlying Income Before Taxes ($MM)$531.2 $479.5 $341.0
Financial Volume (m hl)22.430 20.629 18.585
Brand Volume (m hl)21.715 21.332 18.870
Vs. Estimates (Revenue, EPS)N/A (S&P Global consensus unavailable)N/A (S&P Global consensus unavailable)N/A (S&P Global consensus unavailable)

Segment breakdown – Q4 YoY (columns oldest → newest)

SegmentNet Sales ($MM) Q4’23Net Sales ($MM) Q4’24Underlying Pretax ($MM) Q4’23Underlying Pretax ($MM) Q4’24
Americas$2,231.1 $2,173.9 $363.0 $362.0
EMEA&APAC$566.6 $568.7 $15.3 $24.2

KPIs – Q4 2024 (YoY drivers and cost lines)

KPIQ4 2024
Net Sales Drivers: Financial volume-6.4%
Net Sales Drivers: Price & sales mix+4.5%
Net Sales Drivers: Currency-0.1%
COGS/hl (reported)+3.2% YoY; drivers: materials/manufacturing inflation, unfavorable mix, volume deleverage; partially offset by +$23.3M favorable mark-to-market and cost savings
Underlying COGS/hl (cc)+5.1% YoY
MG&A (reported)-4.9% YoY; lower marketing vs high prior-year spend and lower incentive comp

Notes: Consolidated net sales per hl growth of 4.8% discussed on call reflects price/mix tailwinds alongside volume headwinds .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Sales (cc)FY 2025N/A (first issuance)Low single-digit increase vs 2024 New
Underlying Pretax Income (cc)FY 2025N/AMid single-digit increase New
Underlying EPSFY 2025N/AHigh single-digit increase New
CapexFY 2025N/A~$750M ±5% New
Underlying Free Cash FlowFY 2025N/A~$1.3B ±10% New
Underlying D&AFY 2025N/A~$675M ±5% New
Net Interest Expense (Consolidated)FY 2025N/A~$215M ±5% New
Underlying Effective Tax RateFY 202523–25% (FY’24 guide) 22–24% Lowered
Dividend per share (quarterly)Q1 2025$0.44 (2024 quarterly run-rate) $0.47 (declared Feb 2025) Raised (+6.8%)
Volume headwinds (Americas)FY 2025N/A~1.9m hl headwind from contract brewing/Pabst exit and Canada third-party volumes; more pronounced in 1H, especially Q1 New

Earnings Call Themes & Trends

TopicQ2 2024 (prev-2)Q3 2024 (prev-1)Q4 2024 (current)Trend
Supply chain / shipmentsBuilt inventory ahead of Fort Worth strike; planned unwind in 2H Unwound inventory; STWs below STRs ~0.2m hl in Q4 plan Largely shipped to consumption for FY; deleverage visible in COGS/hl Normalizing post-build
Pricing & mixNSR/hl +4.2% 1H; Americas price/mix +4.1% Price/mix +4.5% consolidated Price/mix +4.5% consolidated; EMEA&APAC +7.3% Sustained positive
Premiumization (beer)Madrí double-digit; Peroni onshoring plans Madrí growth; prepare Peroni marketing with onshoring Peroni onshoring to drive consistency, packs, margin reinvestment Improving execution
U.S. core brandsRetained ~80% of 2023 gains; Banquet +13% 1H Retained substantial portion; Banquet fastest-growing top 15 YTD Retained >80% of gains in Q4; Banquet +16% volume; shelf space holding Stable/positive
Above-premium U.S.Work to do; Blue Moon rebrand/non-alc Above-premium softness; stabilize Blue Moon Blue Moon stabilization signs; Peroni focus Gradual improvement
Non-alc expansionZOA stake increased to 51% Majority ZOA post-close; strategy reiterated ZOA consolidated; Fever-Tree U.S. partnership + ~$90M equity Accelerating
Macro / consumerValue-seeking, pack/channel shifts Summer softness; improved into Q4 Q4 best 2024 quarter for industry; caution on weekly noise Improving vs summer
Tariffs / input costsModerating inflation; hedges still rolling Cost deleverage; input inflation persists Aluminum largely U.S.-sourced; highlighted tariff uncertainty Managed risk

Management Commentary

  • “2024 marks our third consecutive year of bottom-line growth… we continued to support the health of our brands globally and premiumize our business in several markets… We enter this year confident, issuing 2025 guidance that… aligns with our long-term growth algorithm.” – CEO Gavin Hattersley .
  • “We… ended the year with a net debt to underlying EBITDA ratio of 2.09x… enabled us to invest… while returning cash to shareholders through a growing dividend and share repurchases.” – CFO Tracey Joubert .
  • On premiumization and portfolio: “We are changing the shape of our global portfolio… targeted plans for the U.S… operations outside the U.S. are performing well… contributing meaningfully to our growth.” – CEO (prepared remarks) .
  • On 2025 drivers: anticipated 1–2% North America pricing, mix uplift toward ~1/3 above-premium NBR, moderating inflation and productivity/cost savings, with volume headwinds near term from contract exits .

Q&A Highlights

  • Category backdrop and guidance: Management cautioned against reading weekly volatility; noted Q4 was the best quarter for industry performance in 2024; buybacks will continue via systematic/opportunistic 10b5-1 execution .
  • Gross margin/COGS and aluminum: Expect 2025 margin expansion from mix (less contract brewing, premiumization), moderating input costs, and productivity; aluminum largely U.S.-sourced for U.S. consumption, mitigating tariff risk .
  • Operating leverage and cost savings: Brewery efficiency investments, contract-brewing exit, and Peroni onshoring (ocean freight savings reallocated to marketing) are key EPS drivers .
  • Shelf space: Unprecedented gains in 2023 held into fall resets; expecting to hold gains again in spring 2025 .
  • Non-alc strategy: Fever-Tree U.S. economics (100% U.S. revenue recognition, profit-sharing at EBITDA, royalty in COGS) and ZOA majority stake to accelerate distribution/marketing; one-time integration fees expected in 1Q25 .

Estimates Context

  • Wall Street consensus (S&P Global) for Q4 2024 revenue and EPS was not available at the time of analysis due to data access limits; as a result, we cannot quantify beats/misses vs consensus for this quarter (S&P Global consensus unavailable).

Key Takeaways for Investors

  • Mix-led earnings resilience: Despite Q4 net sales -2.0% YoY, underlying EPS rose 9.2% on price/mix, lower MG&A, and tax rate; EMEA&APAC profitability improved on premiumization .
  • 2025 bridge: Expect NSR (cc) up low-single digits, underlying pretax income (cc) up mid-single digits, and underlying EPS up high-single digits—underpinned by pricing discipline, premiumization, cost-savings, and reduced low-margin contract brewing .
  • Portfolio premiumization: Madrí momentum (U.K.), Peroni onshoring (U.S.), and Canada above-premium strength position mix and potentially margins higher into 2025 .
  • Non-alc catalysts: ZOA consolidation and Fever-Tree U.S. license + equity stake expand occasions and mix; watch 1Q25 integration costs and subsequent revenue ramp .
  • U.S. core brand durability: >80% retention of 2023 share gains and held shelf-space gains; Banquet growth remains standout .
  • Watch risks: Near-term volume headwinds (~1.9m hl) from contract brewing and Canadian third-party exits (more pronounced 1H25), competitive U.K. backdrop, and ongoing consumer value-seeking behavior .
  • Capital returns: 6.8% dividend increase to $0.47 and active repurchases demonstrate confidence and balance sheet capacity (2.09x net debt/underlying EBITDA) .