Brewer MillerCoors reported a modest 3.5% increase in third-quarter net income as higher prices and cost cutting offset a drop in beer volume. Here’s what you need to know about the latest earnings report.
What you need to know: Many of MillerCoors’s long-established brands continue to post volume declines in the latest quarter, a trend that has prolonged for years as more consumers prefer craft beer offerings and as the spirits and wine industries steal market share from the overall beer category. Volume dropped for Coors Light, Miller Lite, Keystone Light and Milwaukee’s Best.
But some of the MillerCoors’s portfolio performed well. The Redd’s franchise, a flavored malt beverage that first hit shelves nationally in early 2013, posted a double-digit increase in volume. Redd’s is a way MillerCoors aims to defend itself against spirits and gain back market share, as well as attract Millennial consumers that increasingly want more flavorful offerings. Blue Moon volume also grew, as did the Leinenkugel’s franchise. Leinenkugel’s growth was driven by Summer Shandy, an alcoholic beverage that has performed well since its debut in 2007.
The big number: Total sales increased 0.9% in the third quarter to $2.07 billion at MillerCoors, a joint venture created in 2008 to combine the U.S. beer operations of Molson Coors and SABMiller PLC of the United Kingdom. Net income for the period rose to $376.7 million. But volume, measured as sales-to-retailers, slipped 3.7%.
Villa told Fortune that the new spring seasonal will hit shelves in January. “Like all craft brewers, we try to give our fans new tastes experiences every two to three years,” Villa said. “We’ve had a lot of great feedback.”