Coors reports rise in third quarter earnings - Adolph Coors Co - Brief Article

Modern Brewery Age, Nov 4, 2002

AP--Adolph Coors Co. continued to reap benefits from its acquisition of British brewer Carling and a new NFL sponsorship, reporting a 20 percent gain in third-quarter profit Thursday. The No. 3 American brewer landed a sponsorship deal for the football league this year as a key part of targeting newly legal beer drinkers.

"They finally have the advertising, and the NFL tie-ins are giving the Coors brand a little more visibility with the younger beer drinker, which hasn't been the case recently," Prudential Securities Inc. analyst Jeff Kanter said.

The quarterly earnings of $46.6 million, or $1.28 per share, were up from $38.9 million, or $1.05 per share, in the third quarter last year. The results were above the $1.26 per share earnings expected by Wall Street analysts, according to Thomson First Call.

Coors acquired Carling from Interbrew S.A. in February and formed Coors Brewers Ltd., which executives credited for the increase in income.

Sales for the quarter reached $1 billion, up 58 percent from $634.7 million during the same period a year ago. Coors has 11 percent of the U.S. beer market, behind A-B and Miller.

In the United States, chief financial officer Timothy Wolf said, marketing costs have risen in the low double-digit percentages since last year for Coors, which has done everything from enlisting musician Kid Rock in commercials to inking a marketing deal with Miramax.

Higher beer taxes hurt sales in the key market of Puerto Rico, and discounts by competitors in Britain during the World Cup hurt sales there, but British sales regained momentum later in the quarter, said Coors' chief executive officer, W. Leo Kiely III.

While the top brands of Coors Original, Coors Light and Keystone did well, Zima and Killian's struggled, Kiely said.

For the first nine months of the year, Coors earned $141.4 million, or $3.88 a share, up from $107.1 million, or $2.86 a share, a year ago. Revenue rose to $2.8 billion from $1.9 billion.