UPDATE 2-Molson Coors beats expectations on Starbev addition
By Atossa Araxia Abrahamian
Aug 6 (Reuters) - Molson Coors Brewing Co on Tuesday reported a higher-than-expected quarterly profit thanks to a recent addition to its European business, sending shares up almost 5 percent.
The strong results were mainly due to the company's acquisition of Central European brewer Starbev in June 2012, which increased the company's capacity in countries like the Czech Republic and Romania and boosted sales almost 18 percent.
These sales helped offset bad weather and what was otherwise weak demand for beverages in the United States, Canada and elsewhere in Europe.
"Consumer demand was soft, but due to a combination of good cost management and the benefit of the Eastern Europe business, the numbers came through well," said Chief Executive Peter Swinburn.
The company's second quarter also benefited from a lower tax rate in Canada, Swinburn said.
MillerCoors, the combined U.S. operations of Molson Coors and SABMiller, reported a 5.3 percent decline in second-quarter net income on Tuesday, citing low volume and a difficult quarter for the beer industry.
Swinburn said higher priced beverages, such as Redd's Apple Ale and Leinenkugel's Summer Shandy, gained market share in the quarter. The premium lines grew to make up more than 9 percent of Molson Coors' portfolio in the quarter, up from 7 percent previously. Continued...