NEW YORK (AP) — Molson Coors Brewing Co., brewer of Blue Moon and Coors Light, reports results for its third fiscal quarter on Wednesday, before the market opens.
WHAT TO WATCH FOR: Molson Coors is increasingly focusing abroad and in emerging markets such as China to woo new drinkers to its Coors Light brand.
Sales have been weaker in more developed markets, such as the U.S. and Europe, where shoppers are still skittish about the economy.
In September, the company's U.S. joint venture, MillerCoors, reported its domestic sales to retailers fell 4 percent, worse than the 2.4 percent drop from the second quarter.
Barclays Capital analyst Michael Branca said he expects the company's fourth-quarter sales to retailers to decline at a slightly greater pace. But he said there is a bright side even as sales are weaker: the company's higher-priced brands did not fall as fast as its lower-priced products. Craft beers and imports rose in the double digits in the U.S. in September, with growth for Blue Moon and Leinenkugel's. Crafts brands, although they make up a smaller portion of sales, have higher prices and therefore more profit.
The company has been raising prices in the downturn to protect its brands from being seen as too cheap, even if the amount of beer sold suffers as a result. Branca said price increases are the right course of action and is part of a multi-year strategy.
"We believe the major brewers need to firmly establish the true value of beer brands, and funded by incremental pricing, support that with stepped up high-quality, brand building marketing," he said.
WHY IT MATTERS: The performance of the brewer's brands can show how people feel about spending because they're bought at all income levels around the world.
WHAT'S EXPECTED: Analysts expect the company to earn $1.14 per share on revenue of $881.6 million, according to Thomson Reuters.
LAST YEAR'S QUARTER: Last year the company earned $235.3 million, or $1.26 per share, on revenue of $853.7 million.
