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Molson Coors Coors

MillerCoors CEO to retire as owner Molson Coor’s marketing drive fails to lift sales

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By Seb Joseph, News editor

February 10, 2015 | 3 min read

MillerCoors has kicked off a search to replace retiring chief executive (CEO) Tom Long as it looks to breathe new life into weak consumer demand that saw its co-owner Molson Coors’ biggest markets pull in lower than expected sales in its latest quarter.

MillerCoors

Long is to retire in the summer (30 June) after four years at the helm of the joint venture between Molson Coors and SABMiller. A search is already underway for his replacement.

He joined Miller Brewing Company prior to the merger in 2005 as chief marketing officer. He was promoted to the president and CEO roles a year later.

Under Long’s stewardship, MillerCoors consistently delivered profit growth, price increases and cost savings, while bolstering areas such as innovation and revenue management. It reflects co-owner Molson Coors' cost-focused principles, which have successfully kept costs down in recent years, extracting around $1bn in cost savings and operation efficiencies since 2008.

MillerCoors' strong balance sheet has allowed it to weather the storm that has seen people drink less beer, particularly millennials. It is a situation brought into sharp focus by Molson Coor’s value and volume sales from its latest quarter.

Global beer volume in the three months to December fell 0.3 per cent year-on-year to 14.0 hectoliters, while full year volume for the year fell 1.3 per cent to 59 hectoliters. The downturn was compounded by a 5.3 per cent sales drop in the quarter to $973m and a 1.2 per cent drop in full year sales to $4.4bn.

While the results are relatively flat, it is indicative of the decline impacting the industry. These declines in volume and value have forced companies like Molson Coors to focus on snaring market share from competitors in order to drive growth. This in turn has pushed the Carling brewer to pump more funds into its marketing and sales, which has knocked earnings in the short term. Molson Coors is ramping up investment in its core brands, which account for 70 per cent of its volume, while continuing to slash costs both in operations and to the consumer.

Molson Coors Coors

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