MOLSON COORS BREWING COMPANY GOLDMAN SACHS

M O L S O N C O O R S B R E W I N G C O M PA N Y
G O L D M A N S A C H S S TA P L E S F O R U M
M AY 2 0 1 5
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MOLSON COORS BREWING COMPANY
Gavin Hattersley
Global CFO
Dave Dunnewald
Global VP, Investor Relations
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FORWARD LOOKING STATEMENT
This presentation includes estimates or projections that constitute “forward-looking statements” within the meaning
of the U.S. federal securities laws. Generally, the words “believe,” "expect,” "intend,” "anticipate,” “project,” “will,”
and similar expressions identify forward-looking statements, which generally are not historic in nature. Although the
Company believes that the assumptions upon which its forward-looking statements are based are reasonable, it can
give no assurance that these assumptions will prove to be correct. Important factors that could cause actual results
to differ materially from the Company’s historical experience, and present projections and expectations are
disclosed in the Company’s filings with the Securities and Exchange Commission (“SEC”). These factors include,
among others, impact of increased competition resulting from further consolidation of brewers, competitive pricing
and product pressures; health of the beer industry and our brands in our markets; economic conditions in our
markets; pension plan costs; availability or increase in the cost of packaging materials; our ability to maintain
manufacturer/distribution agreements; our ability to implement our strategic initiatives, including executing and
realizing cost savings; our ability to successfully integrate newly acquired businesses; changes in legal and
regulatory requirements, including the regulation of distribution systems; increase in the cost of commodities used
in the business; our ability to maintain brand image, reputation and product quality; our ability to maintain good
labor relations; changes in our supply chain system; additional impairment charges; the impact of climate change
and the availability and quality of water; risks relating to operations in developing and emerging markets; success of
our joint ventures; lack of full-control over the operations of MillerCoors; and other risks discussed in our filings with
the SEC, including our Annual Report on Form 10-K for the year-ended December 31, 2014, which is available from
the SEC. All forward-looking statements in this press release are expressly qualified by such cautionary statements
and by reference to the underlying assumptions. You should not place undue reliance on forward-looking
statements, which speak only as of the date they are made. We do not undertake to update forward-looking
statements, whether as a result of new information, future events or otherwise.
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MOLSON COORS OVERVIEW (2014 FY)
UNITED STATES (42%)
CANADA
EUROPE
INTERNATIONAL MARKETS
36%
14%
Worldwide
Beer
Volume
46%
(1)
5%
31%
24%
30%
Net
Sales(1)
44%
2%
21% Underlying
Pretax
Income(2)
48%
Excludes Corporate and Eliminations from the total.
Does not include underlying pretax losses for Corporate and MCI. Totals may not sum due to rounding. Non
GAAP underlying income is calculated by excluding special and other non-core items from the nearest U.S.
GAAP earnings. See reconciliation to nearest U.S. GAAP measures on our website.
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(2)
COMMERCIAL DRIVERS OF STRATEGIC VALUE
INVESTING BEHIND
DRIVING SHARE
CORE BRANDS
IN ABOVE PREMIUM
DELIVERING VALUE
DRIVE COST SAVINGS AND
ADDED INNOVATION
COMMERCIAL EXCELLENCE
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DRIVING TOTAL SHAREHOLDER RETURN WITH PACC MODEL
BRAND-LED
PROFIT
GROWTH
• Investing behind core brands
• Driving share in above premium
• Delivering value-added innovation
• Commercial excellence
CASH
GENERATION
• Cost reductions
• Capital expenditure driving
efficiencies
• Working capital improvements
CASH AND
CAPITAL
ALLOCATION
• Disciplined cash use
• Return-driven criteria
• Balanced priorities
Profit
After
Capital
Charge
(TSR)
TOTAL
SHAREHOLDER
RETURN
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UNDERLYING EARNINGS GROWTH IN TOUGH TIMES…
MCBC Underlying Pretax Income (1)
$794
$800
$821
$865
$865
2012
2013
$904
$719
$600
$646
$642
2007
2008
$541
$441
$400
($millions)
$200
$0
2005
2006
2009
2010
2011
2014
Underlying pretax income growth over the past 9 years totaled 105%
(1)
Non-GAAP underlying pretax income is calculated by excluding special and other non-core
items from the nearest U.S. GAAP earnings. See reconciliation to nearest U.S. GAAP
measures on our website.
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…AND STEADY, STRONG, GROWING EBITDA
Underlying EBITDA(1)
$1,600
$1,398
$1,400
$1,200
$1,106
$1,100
$1,091
2006
2007
2008
$1,127
$1,212
$1,469
$1,471
2013
2014
$1,267
$1,000
$800
$600
($millions)
$400
$200
$0
2009
2010
2011
2012
2014: nearly $8 per share
(1)
Non-GAAP underlying EBITDA (Earnings before interest, taxes, depreciation and amortization)
is calculated excluding special and other non-core items from U.S. GAAP earnings. See
reconciliation to nearest U.S. GAAP measures on our website. Includes 42% of MillerCoors
underlying EBITDA.
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GROWING CASH RETURNS VIA DIVIDENDS
Dividends Paid (Annual Per Share)
$1.64
$1.48
$1.50
$1.24
$1.28
$1.28
2012
2013
$1.08
$0.92
$1.00
(dividend per share)
$0.76
$0.64
$0.64
2006
2007
$0.50
$0.00
2008
2009
2010
2011
2014
2015E
Dividend payout ratio of 18%-22% of trailing underlying EBITDA
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COST REDUCTIONS HELP TO DRIVE TOP LINE AND BOTTOM LINE
BRAND-LED PROFIT GROWTH
CASH GENERATION
CASH AND CAPITAL
Cumulative Annualized Cost Savings (1)
$1,333
$1,400
$1,195
$1,200
$1,078
$958
$1,000
$851
$800
$657
$600
$442
$331
($millions)
$400
$200
$185
$81
$0
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
Over $1.3 billion of cost savings delivered in past 10 years
(1)
Includes 42% of MillerCoors cost savings
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KEY VALUE DRIVER: DISCIPLINED CASH USE
BRAND-LED PROFIT GROWTH
CASH GENERATION
CASH AND CAPITAL
Cash use priorities
•
Strengthen balance sheet by reducing liabilities
•
Return cash to shareholders
•
Brand-led growth opportunities
Short-term focus
•
11% increase in dividend 1st Quarter 2015
•
Dividend payout ratio: 18-22% of trailing year EBITDA (Current: 20.6% of 2014 EBITDA)
•
New $1 billion, four-year share repurchase program
Consistent return-driven criteria
•
PACC driven
•
ROIC/WACC
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STRONG BASE, DRIVING TSR
BRAND-LED PROFIT
GROWTH
2014 Results:
• Achieved higher underlying
pretax and EPS
CASH
GENERATION
• Steady and strong underlying EBITDA
• Exceeded cost savings targets
• Improved cash conversion cycle
• Generated $957 million in underlying
free cash flow
CASH AND CAPITAL
ALLOCATION
• Double-digit dividend increase
• $1 billion share repurchase program
Strategy working, committed to PACC
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