Beverage News / Beer

MillerCoors sales increase in Q1 2014

Brewer gains share in above-premium, premium light beer markets

Chicago-based MillerCoors, a joint venture between London-based SABMiller plc and Denver-based Molson Coors Brewing Co., saw its net income for the first quarter increase 7.4 percent to $291.9 million compared with the same period in the prior-year period. This income growth was driven by positive pricing and sales mix, cost savings, and lower marketing spending, primarily due to timing differences versus last year, the company says.

“In the first quarter, we continued to gain share in the high-margin and fast-growing above-premium space with Miller Fortune and the Redd’s franchise,” said MillerCoors Chief Executive Officer Tom Long in a statement. “In above premium, we are expanding the category and attracting new legal drinking age (LDA) consumers to beer with our innovations and brands like Leinenkugel’s and Blue Moon. The key to our success will be our performance in premium lights, which have been particularly challenged recently, including in the first quarter. We have made Miller Lite more relevant for millennials by bringing back the Original Lite Can, and we gained share in the premium light segment. This month, we will continue to engage legal drinking age millennials around premium lights with the release of Coors Light’s first line extension, Coors Light Summer Brew.”

The company noted that premium light portfolio sales-to-retail (STRs) declined 3.4 percent but still gained segment share in the first quarter, according to Nielsen data.

Coors Light declined mid-single digits in the first quarter. The brand will connect with legal drinking age millennial consumers in 2014 by introducing new, cutting-edge designs on packaging each trimester, it says. For instance, Coors Light Summer Brew, which launched last week and will be available in 10-ounce cans while supplies last, features a bright orange and yellow citrus-inspired design over the brand’s signature Rocky Mountain landscape. Coors Light also will engage sports fans and Latino consumers by continuing its partnership with the LigaMx soccer league and through advertising during this year’s World Cup broadcasts from Brazil.

Miller Lite declined mid-single digits in the first quarter but achieved a high-single digit trend improvement in can STRs versus the fourth quarter of 2013. The brand brought back the Original Lite Can in the first quarter to tell the story of Miller Lite’s authenticity to a new generation of LDA beer drinkers. Based on these results, the Original Lite Can will be in market through September, and an updated design inspired by the brand’s original look will be unveiled in October across all packaging, the company says. Prior to this repackaging, this summer, Miller Lite will launch its “Miller Time for America” campaign, which will encourage consumers to engage with the brand online for a chance to have their photos included in a national TV commercial.

Above-premium portfolio STRs grew high teens in the first quarter, ahead of the rest of the segment’s growth.  Innovations delivered excellent volume and value growth in above premium, led by Miller Fortune and the Redd’s franchise, the company says. Launched in February, Miller Fortune was supported with strong distribution and gained a 0.3 share of total industry volume in March, it notes, citing Nielsen data. The Redd’s franchise performed well in the first quarter, more than doubling its volume versus the prior year, and Redd’s Apple Ale continues to be one of the fastest-growing brands in the U.S. beer category, it adds.

Overall, MillerCoors subsidiary Tenth and Blake Beer Co. declined mid-single digits, driven by double-digit declines in Blue Moon seasonals, Henry Weinhard’s, Killian’s and Batch 19. This was partially offset by double-digit growth of the Leinenkugel’s franchise and low-single-digit growth of Blue Moon Belgian White, which extended its run of 74 consecutive quarters of growth. Leinenkugel’s Shandy variants continued to capture the most absolute volume growth among all craft brands in the quarter, the company says, citing Nielsen data.

Coors Banquet grew mid-single digits in the first quarter and has grown for more than seven consecutive years, the company says. In 2014, the brand launched one of its biggest media plans and Coors Banquet TV advertising, which will air nationally throughout the year, it adds. Coors Banquet also will highlight Western masculinity with four new can designs in market from April through June.

Among other brand marketing campaigns, in April 2014, Miller High Life and Keystone Light returned to TV with national advertising campaigns for the first time since 2012, and Keystone Light is continuing its partnership with the FLW Walmart Bass Fishing Tour Series.

For more information about MillerCoors, visit www.millercoors.com.

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