Molson Coors Brewing Co. says its net income dropped to US$121.8 in the third quarter on one-time charges in Europe, but its underlining profit increased 7.7 per cent to US$268.1 million, beating analyst expectations.
The Denver and Montreal-based company, which reports in U.S. dollars, earned 66 cents per share for the period ended Sept. 28, down from $1.09 per share or $198.4 million in the prior year. It recorded $163.1 million of special and non-core expenses.
Excluding these one-time charges, Molson Coors' earned $268.4 million or $1.45 per share, compared to $248.9 million or $1.37 per share in the 2012 quarter.
Total sales decreased two per cent to US$1.17 billion on a 0.9 per cent dip in worldwide beer volume to 17 million hectolitres.
The company was expected to earn $1.39 per share on $1.21 billion of revenues, according to analysts polled by Thomson Reuters.
Molson Coors' (TSX:TPX.B, NYSE:TAP) Canadian operations struggled as underlining pre-tax profit slipped 13 per cent to $130.6 million despite lower costs because of a decrease in volume and the value of the Canadian dollar.
Net sales decreased 9.2 per cent to $526.7 million on a 5.2 per cent drop in volume. Sales to retailers decreased 3.3 per cent primarily due to higher beer excise taxes in Quebec, weak economic conditions and increased promotional activity by competitors.
The Canadian beer market decreased about one per cent and Molson Coors' market share fell by about the same amount.
Its U.S. business earned $363.8 million, up 11.7 per cent on higher prices and cost reductions, partially offset by lower volumes.
The European operations earned $95 million in underlining pre-tax income, up 5.7 per cent from the prior year on higher prices and sales volumes in Czech Republic, Croatia and Britain, offset by decreases in most of its Central European markets.
The international business lost $2.1 million compared to a loss of $5.6 million in the prior year.