Beer giant Molson Coors slides after missing on sales and saying it made accounting errors
- The beer giant Molson Coors beat on fourth-quarter profits but missed on sales.
- The company said it would restate its financial statements for fiscal 2016 and 2017 after its audit committee identified some accounting errors.
- The beverage giant is bullish on cannabis and in August entered a joint venture with HEXO, a Quebec-based cannabis cultivator, to produce infused beverages for the Canadian market.
- Watch Molson Coors trade live.
Molson Coors, one of the world's largest beer makers, dropped 4.98% to $67.80 apiece on Tuesday after the company posted lower-than-expected sales in the fourth quarter and said it made accounting errors in its financial statements for fiscal 2016 and 2017.
The company reported $0.84 in adjusted earnings per share, topping the Wall Street consensus of $0.80, according to Bloomberg data. Its top line came at $2.42 billion, below the $2.54 billion that was expected.Meanwhile, Molson Coors said it would restate its previous two annual financial reports after its audit committee identified some accounting errors related to the deferred tax liabilities for its acquisition of a 58% stake in MillerCoors in 2016.
Adjusting the accounting errors, the 2016 net income should be $399.1 million lower and its 2017 net income should be $ 151.4 million higher, the company said in a filing, adding that the impact will not be "material."
"We accomplished much in 2018, delivering strong free cash flow and meeting our deleverage commitments, restoring underlying EBITDA growth in the quarter and second half, premiumizing our portfolio across regions including launching Truss our Canadian cannabis beverage JV, scaling volume and profitability in our fast growing International business and continuing to strengthen our European business," said CEO Mark Hunter in a press release.
In August, the beverage giant entered a joint venture with HEXO, a Quebec-based cannabis cultivator, to produce infused beverages for the Canadian market.
Hunter is bullish on cannabis. He said in November during the company's third-quarter earnings call that the Canadian cannabis market could total as much as $10 billion and Cannabis-infused beverages could represent up to 30% of that market.
Molson Coors is up 19% so far this year.
- The CEO of Molson Coors says the market for cannabis-infused beverages could be worth billions. Here's why it's 'chasing down' that opportunity.