Molson Coors has announced a revitalisation plan to drive long-term, sustainable success, after recording a continuous decline in its third quarter results.
The company – which owns brands such as Coors Light, Carling and Blue Moon – reported a 3.2% decrease in net sales in the last three months, compared to the same period last year.
Meanwhile the brewer delivered a US GAAP net loss of $403 million, which it claims is predominately due to the Canadian Goodwill Impairment Charge.
In Europe, net sales decreased by 3.4%, reportedly driven by unfavourable foreign currency, a decline in brand volumes and ‘soft industry demand’. A fall in net sales was particularly noted in its international business which saw a decline of 15.7%.
According to Molson Coors, its performance was negatively affected by rapidly shifting drinking preferences and other alcoholic and non-alcoholic beverages causing beer to lose business, however it delivered strong results through its premium brands.
As part of its revitalisation plan, Molson Coors will reorganise its structure, by moving from a corporate centre and four business units (MillerCoors in the US, Molson Coors Canada, Molson Coors Europe and Molson Coors International) to two streamlined business units – North America and Europe.
This simplified structure will enable the company to move more efficiently with an integrated portfolio strategy and improve decision making. It will save approximately $150 million which Molson Coors will use in future investments.
The move will be made effective from January 2020 and expects to reduce employment levels by approximately 400 to 500 employees. It will also see the company change its name to Molson Coors Beverage Company to better reflect its strategic intent.
Molson Coors’ revitalisation plan is designed to accelerate investments behind its iconic brands, while driving growth in its premium beer. After launching two portfolio firsts in 2019, a canned wine and a hard coffee, the company will continue to invest more in whitespace opportunities beyond the beer category with a focus on bringing them to market faster.
The company will also make significant investments in its marketing and potential acquisition opportunities.
Recently appointed president and chief executive officer of Molson Coors, Gavin Hattersley said: “Our business is at an inflection point. We can continue down the path we’ve been on for several years now, or we can make the significant and difficult changes necessary to get back on the right track.
“Our revitalization plan is designed to streamline the company, move faster, and free up resources to invest in our brands and our capabilities. Through it, we will create a brighter future for Molson Coors.”
Considered by the company as a transition year, Molson Coors expect to record a flat to low-single digit decrease in net sales revenue for full year 2020.
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