Molson Coors Beverage Company Q1 FY2025 earnings call

• Global macroeconomic environment is volatile with geopolitical and trade policy impacts on consumption trends. Molson Coors is better positioned as most brands sold in U.S. and Canada are made locally. • Had shipment headwinds and one-time Fever-Tree transition fees in low revenue quarter. • Focus on controlling what can be controlled: strengthening core power brands, premiumizing business, cost-saving opportunities, adjusting capital expenditure plans. • Core power brands in U.S. retained share gains, Coors Banquet had strong momentum. • Premiumization efforts in various regions with brands like Blue Moon, Peroni, Madrí. • Investments in non-alc brands like ZOA and Fever-Tree for growth.

Consolidated net sales revenue was down 10.4%, underlying pre-tax income was down 49.5%, and underlying earnings per share was down 47.4%. In the U.S., U.S. financial volume was down 15.7% and U.S. brand volume was down 8.8%. Net sales revenue per hectoliter in the Americas was up 4.8% due to mix benefits from exit of contract brewing volume and positive brand mix from Fever-Tree. In EMEA and APAC, financial volume was down 9.7% but net sales revenue per hectoliter was up 5.4% due to favorable sales mix. Core power brands in U.S. like Coors Light, Miller Lite, and Coors Banquet had combined 15.4 volume share (up from 13.5 in Q1 2023). Coors Banquet had double-digit brand volume growth and 20% distribution gains. In Canada, Coors Light was number one light beer and Molson family of brands had volume share gains. In EMEA and APAC, Carling in U.K. was top lager, Ožujsko in Croatia was segment leader, Caraiman in Romania gained value share. Premiumization efforts: In Americas, Canada premiumized with Miller Lite and flavor portfolio. In U.S., Blue Moon brand family held share, Blue Moon non-alc gained dollar share. Peroni in U.S. saw onshore production drive cost savings and expansion. Beyond Beer: Non-alc brands like ZOA and Fever-Tree had growth. ZOA had majority stake and distribution expansion, Fever-Tree U.S. volume was ~500,000 hectoliters in 2024.

• Revised full-year guidance: low single-digit net sales revenue decline on constant currency basis (previously low single-digit growth), low single-digit underlying pre-tax income decline on constant currency basis (previously mid-single-digit growth), low single-digit underlying earnings per share growth (previously high single-digit growth). • Reaffirmed underlying free cash flow guidance of $1.3 billion, plus or minus 10%. • Lowered capital expenditures to $650 million, plus or minus 5% (previously $750 million, plus or minus 5%).

• Global macroeconomic volatility including geopolitical events, trade policy impacts on economic growth, consumer confidence, inflation, and currencies. • Uncertainty around timing and magnitude of macroeconomic impacts on consumption trends. • Volatility in consumer demand and industry competition.

Q: Bryan Spillane asked about U.S. market slower than expected and improvement in back half.

A: First quarter had expected headwinds, trends have improved quarter-over-quarter, industry showed improvement in April.

Q: Bonnie Herzog asked about share retention and month-to-month trends.

A: Retained almost all core share gains, trends improved quarter-over-quarter, had pack shift impact on Blue Moon in March.

Q: Filippo Falorni asked about beer category outlook and tariffs.

A: Industry expected to normalize, tariffs had immaterial impact on input costs.

Q: Chris Carey asked about cost inflation and leadership transition.

A: Cost inflation mitigated by hedging and cost savings, leadership transition process underway.

Q: Peter Grom asked about category growth and second quarter outlook.

A: Incremental softness macro-driven, expected industry to normalize.

Q: Greg (for Robert Ottenstein) asked about EMEA and APAC competitive landscape.

A: U.K. had competitive market, Central and Eastern Europe had sluggish industry with promotional pressures.

Q: Andrea Teixeira asked about price architecture and Blue Moon.

A: Core share retained, Blue Moon had pack adjustment with temporary impact but long-term benefits.

Q: Kaumil Gajrawala asked about pricing and promotion.

A: No unusual promotion expected, value driving behavior seen.

Q: Lauren Lieberman asked about CapEx adjustment.

A: Postponing projects not related to significant cost savings or growth initiatives.

Q: Michael Lavery asked about America's price mix.

A: Fever-Tree costs go through MG&A line, NSR per hectoliter in North America up due to mix.

Q: Kevin Grundy asked about capital deployment and stock performance.

A: Strong balance sheet and cash generation underappreciated, core brands have strong performance.

Q: Eric Serotta asked about midterm category growth.

A: Expect category to normalize, work ongoing in premium space.

Q: Robert Moskow asked about North America forecast.

A: Drivers include net price increases, shipment recovery, premiumization and partnerships.