Molson Coors Beverage Company (TAP) Q2 2024 earnings summary

Executive summary

• Net sales for Q2 2024 were $3,252.3M, down 0.4% year-over-year, while underlying pre-tax income grew 5.2% and underlying EPS rose 7.9% year-over-year; net income attributable to shareholders increased 24.7% to $427.0M, and diluted EPS rose 29.3% to $2.03.

• First half net sales revenue increased 4.2%, underlying pre-tax income rose 20.4%, and underlying EPS grew 23.8% year-over-year.

• EMEA & APAC regions contributed meaningfully due to favorable net pricing, premiumization, and brand volume growth, while Americas volumes declined due to contract brewing exit and shipment timing.

• Strong cash flow generation enabled continued investment in brands, share repurchases, and dividend increases.

• Maintained 2024 full-year guidance for both top- and bottom-line growth despite headwinds from shipment timing, contract brewing exit, and a 14-week strike at the Fort Worth brewery.

Financial highlights

• Q2 2024 net sales revenue was $3,252.3M, down 0.4% year-over-year; H1 2024 net sales revenue was $5.85B, up 4.2%.

• Underlying income before income taxes: $531M in Q2, up 5.2% year-over-year; $790M for H1, up 20.4%.

• Underlying EPS: $1.92 in Q2, up 7.9%; $2.86 for H1, up 23.8%.

• Gross profit for Q2 2024 was $1,329.9M, up 9.1% year-over-year, with gross margin improvement from cost savings and favorable derivatives.

• Underlying free cash flow for H1 was $505M; $564M was returned to shareholders via dividends and share repurchases.

Outlook and guidance

• 2024 guidance reaffirmed: low single-digit net sales revenue growth, mid-single-digit underlying pre-tax income and EPS growth, and underlying free cash flow of $1.2B ±10%.

• Capital expenditures targeted at $750M (±5%).

• Underlying effective tax rate expected between 23% and 25%.

• U.S. shipment timing and contract brewing exit to impact H2, but most effects expected to unwind in Q3.

• Management expects continued benefit from premiumization, cost savings, and pricing, but notes risks from cost inflation and market competition.