Bad news for hops fans, it will cost you enjoying your favorite “little frets” by the end of 2022.
Posted at 6:00 AM
Molson Coors has announced a 3-5% increase in the price of its products in the US by the end of 2022. Everything indicates that Canadian consumers are not going to spare.
I am not used to giving indications of future price increases in Canada. Fredrik Landmetters, president of Molson Coors Canada, said in an interview with Journalism.
Inflation reached 8.1% in June and the Bank of Canada expects it to remain at around 8% in the third quarter of 2022.
This will be a second price increase. At the beginning of the year, Molson Coors raised their prices by 4 to 5% in the United States. The Canadian Division has followed suit.
The price of beer has gone up this year. In Canada, as in the United States, we’ve seen inflation exceed the 2% target by 2021. And we’ve started implementing price increases, as we see everywhere in the economy. The increases are put in place to offset the inflation in our costs.
Fredrik Landmetters, President, Molson Coors Canada
Mr. Landmetters noted that price increases in the beer category have not yet matched the rate of inflation seen in Canada.
The results for the second quarter of 2022, released on Tuesday, showed sales stagnating at $2.9 billion during April, May and June (down 0.6%). Earnings before tax fell 88% to $47.3 million.
Inflation, the residual effect of the abandonment of some economic brands in the United States and the 11-week strike at the brewery in the town of St Hubert, in Longueuil, largely explains these bleak results.
Investors punished the company, with the stock losing 6% of its value Tuesday to $53.49. It must be said that Molson Coors (TAP in New York) is next up 22% since the beginning of the year, a noteworthy performance in a bear market, with the S&P 500 down 13% since 1Verse January. On Friday, TAP ended the session at $54.07, up 2.19%.
Molson Coors also maintains its forecast for 2022: sales up about 5%, pre-tax earnings up for the same demand, free cash flow (free cash flow) of about US$1 billion over the year as a whole.
“For Canada, we’ve been on a really positive trajectory in terms of revenue growth, and frankly, even if the Longueuil labor dispute puts our momentum on hold, I’m very hopeful we’ll get back to it. Coming back to that six weeks after the labor dispute ended,” noted Molson’s president. Coors Canada.
Davis vs. De Bruyne
The sector of alcoholic sparkling water and other new barley-containing beverages continues to deliver on its promise.
“Two weeks ago, I saw that our Vizzy brand had become the number one Couche-Tard in Quebec,” said Mr. Landtmeters. We focused on Vizzy and Coors Seltzer, two brands in the Top 10. Today, we’ve added a third with Topo Chico in English Canada. I plan to launch it in Quebec market by the end of 2023 probably. »
Molson expects a better fourth quarter compared to the 2021 quarter that was plagued by bar and restaurant closures. There is also the FIFA World Cup that will be held during this period. “Normally, November is not a big month for selling beer,” notes the president from the flat-town of Stromae.
Mr. Landtmeters already marked November 23 in his calendar, the day of the meeting between the two teams from his two mother ports: Canada and Belgium.
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