|
(Mark One)
|
|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the Quarterly period ended March 31, 2015
|
|
OR
|
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from ______ to ______ .
|
DELAWARE
(State or other jurisdiction of incorporation or organization)
|
|
84-0178360
(I.R.S. Employer Identification No.)
|
1225 17th Street, Denver, Colorado, USA
1555 Notre Dame Street East, Montréal, Québec, Canada
(Address of principal executive offices)
|
|
80202
H2L 2R5
(Zip Code)
|
Large accelerated filer
ý
|
|
Accelerated filer
o
|
|
Non-accelerated filer
o
|
|
Smaller reporting company
o
|
|
|
(Do not check if a smaller reporting company)
|
|
|
|
|
|
Page
|
|
|
|||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
Sales
|
$
|
1,003.2
|
|
|
$
|
1,178.3
|
|
Excise taxes
|
(303.2
|
)
|
|
(362.3
|
)
|
||
Net sales
|
700.0
|
|
|
816.0
|
|
||
Cost of goods sold
|
(454.8
|
)
|
|
(523.2
|
)
|
||
Gross profit
|
245.2
|
|
|
292.8
|
|
||
Marketing, general and administrative expenses
|
(240.6
|
)
|
|
(263.9
|
)
|
||
Special items, net
|
(8.6
|
)
|
|
52.5
|
|
||
Equity income in MillerCoors
|
129.3
|
|
|
122.8
|
|
||
Operating income (loss)
|
125.3
|
|
|
204.2
|
|
||
Interest income (expense), net
|
(29.2
|
)
|
|
(35.4
|
)
|
||
Other income (expense), net
|
(2.6
|
)
|
|
0.8
|
|
||
Income (loss) from continuing operations before income taxes
|
93.5
|
|
|
169.6
|
|
||
Income tax benefit (expense)
|
(12.8
|
)
|
|
(4.8
|
)
|
||
Net income (loss) from continuing operations
|
80.7
|
|
|
164.8
|
|
||
Income (loss) from discontinued operations, net of tax
|
1.9
|
|
|
(1.9
|
)
|
||
Net income (loss) including noncontrolling interests
|
82.6
|
|
|
162.9
|
|
||
Net (income) loss attributable to noncontrolling interests
|
(1.5
|
)
|
|
0.5
|
|
||
Net income (loss) attributable to Molson Coors Brewing Company
|
$
|
81.1
|
|
|
$
|
163.4
|
|
Basic net income (loss) attributable to Molson Coors Brewing Company per share:
|
|
|
|
||||
From continuing operations
|
$
|
0.43
|
|
|
$
|
0.90
|
|
From discontinued operations
|
0.01
|
|
|
(0.01
|
)
|
||
Basic net income (loss) attributable to Molson Coors Brewing Company per share
|
$
|
0.44
|
|
|
$
|
0.89
|
|
Diluted net income (loss) attributable to Molson Coors Brewing Company per share:
|
|
|
|
||||
From continuing operations
|
$
|
0.42
|
|
|
$
|
0.89
|
|
From discontinued operations
|
0.01
|
|
|
(0.01
|
)
|
||
Diluted net income (loss) attributable to Molson Coors Brewing Company per share
|
$
|
0.43
|
|
|
$
|
0.88
|
|
Weighted-average shares—basic
|
185.8
|
|
|
184.3
|
|
||
Weighted-average shares—diluted
|
186.9
|
|
|
185.5
|
|
||
Amounts attributable to Molson Coors Brewing Company
|
|
|
|
||||
Net income (loss) from continuing operations
|
$
|
79.2
|
|
|
$
|
165.3
|
|
Income (loss) from discontinued operations, net of tax
|
1.9
|
|
|
(1.9
|
)
|
||
Net income (loss) attributable to Molson Coors Brewing Company
|
$
|
81.1
|
|
|
$
|
163.4
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
Net income (loss) including noncontrolling interests
|
$
|
82.6
|
|
|
$
|
162.9
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
||||
Foreign currency translation adjustments
|
(664.3
|
)
|
|
(182.0
|
)
|
||
Unrealized gain (loss) on derivative instruments
|
18.9
|
|
|
14.5
|
|
||
Reclassification of derivative (gain) loss to income
|
(1.4
|
)
|
|
(3.2
|
)
|
||
Pension and other postretirement benefit adjustments
|
(1.8
|
)
|
|
—
|
|
||
Amortization of net prior service (benefit) cost and net actuarial (gain) loss to income
|
9.0
|
|
|
7.6
|
|
||
Ownership share of unconsolidated subsidiaries' other comprehensive income (loss)
|
2.2
|
|
|
1.6
|
|
||
Total other comprehensive income (loss), net of tax
|
(637.4
|
)
|
|
(161.5
|
)
|
||
Comprehensive income (loss)
|
(554.8
|
)
|
|
1.4
|
|
||
Comprehensive (income) loss attributable to noncontrolling interests
|
(1.5
|
)
|
|
0.5
|
|
||
Comprehensive income (loss) attributable to Molson Coors Brewing Company
|
$
|
(556.3
|
)
|
|
$
|
1.9
|
|
MOLSON COORS BREWING COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN MILLIONS, EXCEPT PAR VALUE)
(UNAUDITED)
|
|||||||
|
As of
|
||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
317.6
|
|
|
$
|
624.6
|
|
Accounts receivable, net
|
459.1
|
|
|
527.7
|
|
||
Other receivables, net
|
131.2
|
|
|
94.0
|
|
||
Inventories:
|
|
|
|
||||
Finished
|
164.8
|
|
|
135.3
|
|
||
In process
|
20.1
|
|
|
20.7
|
|
||
Raw materials
|
34.0
|
|
|
34.5
|
|
||
Packaging materials
|
10.3
|
|
|
11.7
|
|
||
Total inventories
|
229.2
|
|
|
202.2
|
|
||
Other current assets, net
|
114.8
|
|
|
103.2
|
|
||
Deferred tax assets
|
26.2
|
|
|
27.2
|
|
||
Total current assets
|
1,278.1
|
|
|
1,578.9
|
|
||
Properties, net
|
1,640.6
|
|
|
1,798.0
|
|
||
Goodwill
|
2,021.1
|
|
|
2,191.6
|
|
||
Other intangibles, net
|
5,229.5
|
|
|
5,755.8
|
|
||
Investment in MillerCoors
|
2,499.1
|
|
|
2,388.6
|
|
||
Deferred tax assets
|
40.5
|
|
|
58.2
|
|
||
Notes receivable, net
|
20.6
|
|
|
21.6
|
|
||
Other assets
|
222.2
|
|
|
203.6
|
|
||
Total assets
|
$
|
12,951.7
|
|
|
$
|
13,996.3
|
|
Liabilities and equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable and other current liabilities
|
$
|
1,124.9
|
|
|
$
|
1,305.0
|
|
Deferred tax liabilities
|
183.0
|
|
|
164.8
|
|
||
Current portion of long-term debt and short-term borrowings
|
941.2
|
|
|
849.4
|
|
||
Discontinued operations
|
5.0
|
|
|
6.1
|
|
||
Total current liabilities
|
2,254.1
|
|
|
2,325.3
|
|
||
Long-term debt
|
2,310.1
|
|
|
2,337.1
|
|
||
Pension and postretirement benefits
|
273.9
|
|
|
542.9
|
|
||
Deferred tax liabilities
|
717.4
|
|
|
784.3
|
|
||
Unrecognized tax benefits
|
24.4
|
|
|
25.4
|
|
||
Other liabilities
|
73.9
|
|
|
79.7
|
|
||
Discontinued operations
|
12.8
|
|
|
15.5
|
|
||
Total liabilities
|
5,666.6
|
|
|
6,110.2
|
|
||
Commitments and contingencies (Note 15)
|
|
|
|
|
|
||
Molson Coors Brewing Company stockholders' equity
|
|
|
|
||||
Capital stock:
|
|
|
|
||||
Preferred stock, no par value (authorized: 25.0 shares; none issued)
|
—
|
|
|
—
|
|
||
Class A common stock, $0.01 par value per share (authorized: 500.0 shares; issued and outstanding: 2.6 shares and 2.6 shares, respectively)
|
—
|
|
|
—
|
|
||
Class B common stock, $0.01 par value per share (authorized: 500.0 shares; issued: 170.7 shares and 169.9 shares, respectively)
|
1.7
|
|
|
1.7
|
|
||
Class A exchangeable shares, no par value (issued and outstanding: 2.9 shares and 2.9 shares, respectively)
|
108.4
|
|
|
108.5
|
|
||
Class B exchangeable shares, no par value (issued and outstanding: 17.5 shares and 17.6 shares, respectively)
|
659.7
|
|
|
661.5
|
|
||
Paid-in capital
|
3,903.7
|
|
|
3,871.2
|
|
||
Retained earnings
|
4,444.8
|
|
|
4,439.9
|
|
||
Accumulated other comprehensive income (loss)
|
(1,535.8
|
)
|
|
(898.4
|
)
|
||
Class B common stock held in treasury at cost (7.5 shares and 7.5 shares, respectively)
|
(321.4
|
)
|
|
(321.1
|
)
|
||
Total Molson Coors Brewing Company stockholders' equity
|
7,261.1
|
|
|
7,863.3
|
|
||
Noncontrolling interests
|
24.0
|
|
|
22.8
|
|
||
Total equity
|
7,285.1
|
|
|
7,886.1
|
|
||
Total liabilities and equity
|
$
|
12,951.7
|
|
|
$
|
13,996.3
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income (loss) including noncontrolling interests
|
$
|
82.6
|
|
|
$
|
162.9
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|||
Depreciation and amortization
|
77.5
|
|
|
81.2
|
|
||
Amortization of debt issuance costs and discounts
|
1.4
|
|
|
1.6
|
|
||
Share-based compensation
|
3.2
|
|
|
8.3
|
|
||
(Gain) loss on sale or impairment of properties and other assets, net
|
(0.7
|
)
|
|
1.2
|
|
||
Deferred income taxes
|
(3.8
|
)
|
|
0.5
|
|
||
Equity income in MillerCoors
|
(129.3
|
)
|
|
(122.8
|
)
|
||
Distributions from MillerCoors
|
129.3
|
|
|
122.8
|
|
||
Equity in net (income) loss of other unconsolidated affiliates
|
(1.4
|
)
|
|
(4.2
|
)
|
||
Distributions from other unconsolidated affiliates
|
—
|
|
|
11.1
|
|
||
Excess tax benefits from share-based compensation
|
(6.1
|
)
|
|
(2.0
|
)
|
||
Unrealized (gain) loss on foreign currency fluctuations and derivative instruments, net
|
1.4
|
|
|
(1.8
|
)
|
||
Change in current assets and liabilities and other
|
(354.8
|
)
|
|
(111.0
|
)
|
||
(Gain) loss from discontinued operations
|
(1.9
|
)
|
|
1.9
|
|
||
Net cash provided by (used in) operating activities
|
(202.6
|
)
|
|
149.7
|
|
||
Cash flows from investing activities:
|
|
|
|
|
|
||
Additions to properties
|
(73.7
|
)
|
|
(65.3
|
)
|
||
Proceeds from sales of properties and other assets
|
3.0
|
|
|
1.7
|
|
||
Acquisition of businesses, net of cash acquired
|
(6.3
|
)
|
|
—
|
|
||
Investment in MillerCoors
|
(417.9
|
)
|
|
(354.9
|
)
|
||
Return of capital from MillerCoors
|
310.4
|
|
|
259.5
|
|
||
Loan repayments
|
9.2
|
|
|
2.2
|
|
||
Loan advances
|
(17.9
|
)
|
|
(16.7
|
)
|
||
Net cash used in investing activities
|
(193.2
|
)
|
|
(173.5
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
||
Exercise of stock options under equity compensation plans
|
24.8
|
|
|
20.2
|
|
||
Excess tax benefits from share-based compensation
|
6.1
|
|
|
2.0
|
|
||
Dividends paid
|
(76.2
|
)
|
|
(68.2
|
)
|
||
Payments on long-term debt and capital lease obligations
|
(0.3
|
)
|
|
(46.9
|
)
|
||
Proceeds from short-term borrowings
|
16.6
|
|
|
20.9
|
|
||
Payments on short-term borrowings
|
(7.1
|
)
|
|
(12.5
|
)
|
||
Payments on settlement of derivative instruments
|
—
|
|
|
(65.2
|
)
|
||
Net proceeds from (payments on) revolving credit facilities and commercial paper
|
157.8
|
|
|
(41.8
|
)
|
||
Change in overdraft balances and other
|
1.6
|
|
|
111.3
|
|
||
Net cash provided by (used in) financing activities
|
123.3
|
|
|
(80.2
|
)
|
||
Cash and cash equivalents:
|
|
|
|
|
|
||
Net increase (decrease) in cash and cash equivalents
|
(272.5
|
)
|
|
(104.0
|
)
|
||
Effect of foreign exchange rate changes on cash and cash equivalents
|
(34.5
|
)
|
|
(0.7
|
)
|
||
Balance at beginning of year
|
624.6
|
|
|
442.3
|
|
||
Balance at end of period
|
$
|
317.6
|
|
|
$
|
337.6
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions)
|
||||||
Canada
|
$
|
313.5
|
|
|
$
|
347.1
|
|
Europe
|
357.9
|
|
|
437.6
|
|
||
MCI
|
29.1
|
|
|
32.2
|
|
||
Corporate
|
0.4
|
|
|
0.3
|
|
||
Eliminations
(1)
|
(0.9
|
)
|
|
(1.2
|
)
|
||
Consolidated
|
$
|
700.0
|
|
|
$
|
816.0
|
|
(1)
|
Represents inter-segment sales from the Europe segment to the MCI segment.
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions)
|
||||||
Canada
(1)
|
$
|
30.9
|
|
|
$
|
88.3
|
|
U.S.
|
129.3
|
|
|
122.8
|
|
||
Europe
(2)
|
(4.1
|
)
|
|
27.0
|
|
||
MCI
|
(5.4
|
)
|
|
(3.0
|
)
|
||
Corporate
|
(57.2
|
)
|
|
(65.5
|
)
|
||
Consolidated
|
$
|
93.5
|
|
|
$
|
169.6
|
|
(1)
|
Results for the three months ended March 31, 2014, include
$63.2 million
of income related to the termination of our Modelo Molson Imports, L.P. ("MMI") joint venture in Canada. See
Note 4, "Investments"
for further discussion.
|
(2)
|
Results for the three months ended March 31, 2015, include
$11.8 million
of accelerated depreciation expense related to our decision to close one of our U.K. brewing facilities in the second quarter of 2015. See
Note 6, "Special Items"
for further discussion. Additionally, results for the three months ended March 31, 2014, include a gain of
$13.0 million
related to the release of an indirect-tax reserve, inclusive of accrued interest. See
Note 15, "Commitments and Contingencies"
for further discussion.
|
|
As of
|
||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Canada
|
$
|
5,025.2
|
|
|
$
|
5,537.2
|
|
U.S.
|
2,499.1
|
|
|
2,388.6
|
|
||
Europe
|
5,028.7
|
|
|
5,773.3
|
|
||
MCI
|
68.9
|
|
|
75.2
|
|
||
Corporate
|
329.8
|
|
|
222.0
|
|
||
Consolidated
|
$
|
12,951.7
|
|
|
$
|
13,996.3
|
|
|
As of
|
||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Current assets
|
$
|
928.8
|
|
|
$
|
795.3
|
|
Non-current assets
|
9,018.9
|
|
|
9,047.4
|
|
||
Total assets
|
$
|
9,947.7
|
|
|
$
|
9,842.7
|
|
Current liabilities
|
$
|
957.9
|
|
|
$
|
1,061.3
|
|
Non-current liabilities
|
1,526.9
|
|
|
1,578.8
|
|
||
Total liabilities
|
2,484.8
|
|
|
2,640.1
|
|
||
Noncontrolling interests
|
23.4
|
|
|
23.5
|
|
||
Owners' equity
|
7,439.5
|
|
|
7,179.1
|
|
||
Total liabilities and equity
|
$
|
9,947.7
|
|
|
$
|
9,842.7
|
|
|
As of
|
||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||
|
(In millions, except percentages)
|
||||||
MillerCoors owners' equity
|
$
|
7,439.5
|
|
|
$
|
7,179.1
|
|
MCBC economic interest
|
42
|
%
|
|
42
|
%
|
||
MCBC proportionate share in MillerCoors' equity
|
3,124.6
|
|
|
3,015.2
|
|
||
Difference between MCBC contributed cost basis and proportionate share of the underlying equity in net assets of MillerCoors
(1)
|
(660.5
|
)
|
|
(661.6
|
)
|
||
Accounting policy elections
|
35.0
|
|
|
35.0
|
|
||
Investment in MillerCoors
|
$
|
2,499.1
|
|
|
$
|
2,388.6
|
|
(1)
|
Our net investment in MillerCoors is based on the carrying values of the net assets contributed to the joint venture which is less than our proportionate share of underlying equity (
42%
) of MillerCoors (contributed by both Coors Brewing Company ("CBC") and Miller Brewing Company ("Miller")). This basis difference, with the exception of certain non-amortizing items (goodwill, land, etc.), is being amortized as additional equity income over the remaining useful lives of the contributed long-lived amortizing assets.
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions)
|
||||||
Net sales
|
$
|
1,774.6
|
|
|
$
|
1,790.4
|
|
Cost of goods sold
|
(1,076.2
|
)
|
|
(1,094.1
|
)
|
||
Gross profit
|
$
|
698.4
|
|
|
$
|
696.3
|
|
Operating income
|
$
|
309.3
|
|
|
$
|
297.5
|
|
Net income attributable to MillerCoors
|
$
|
304.6
|
|
|
$
|
291.2
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions, except percentages)
|
||||||
Net income attributable to MillerCoors
|
$
|
304.6
|
|
|
$
|
291.2
|
|
MCBC economic interest
|
42
|
%
|
|
42
|
%
|
||
MCBC proportionate share of MillerCoors net income
|
127.9
|
|
|
122.3
|
|
||
Amortization of the difference between MCBC contributed cost basis and proportionate share of the underlying equity in net assets of MillerCoors
|
1.1
|
|
|
1.1
|
|
||
Share-based compensation adjustment
(1)
|
0.3
|
|
|
(0.6
|
)
|
||
Equity income in MillerCoors
|
$
|
129.3
|
|
|
$
|
122.8
|
|
(1)
|
The net adjustment is to eliminate all share-based compensation impacts related to pre-existing SABMiller plc equity awards held by former Miller employees employed by MillerCoors.
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions)
|
||||||
Beer sales to MillerCoors
|
$
|
2.8
|
|
|
$
|
2.6
|
|
Beer purchases from MillerCoors
|
$
|
9.1
|
|
|
$
|
7.1
|
|
Service agreement costs and other charges to MillerCoors
|
$
|
0.6
|
|
|
$
|
0.4
|
|
Service agreement costs and other charges from MillerCoors
|
$
|
0.4
|
|
|
$
|
0.2
|
|
|
As of
|
||||||||||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||||||||||
|
Total Assets
|
|
Total Liabilities
|
|
Total Assets
|
|
Total Liabilities
|
||||||||
|
(In millions)
|
||||||||||||||
Grolsch
|
$
|
6.0
|
|
|
$
|
1.9
|
|
|
$
|
6.8
|
|
|
$
|
2.9
|
|
Cobra U.K.
|
$
|
31.3
|
|
|
$
|
0.7
|
|
|
$
|
31.0
|
|
|
$
|
0.8
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions)
|
||||||
Pretax compensation expense
|
$
|
3.2
|
|
|
$
|
8.3
|
|
Tax benefit
|
(0.8
|
)
|
|
(2.7
|
)
|
||
After-tax compensation expense
|
$
|
2.4
|
|
|
$
|
5.6
|
|
|
RSUs and DSUs
|
|
PUs
|
|
PSUs
|
|||||||||
|
Units
|
|
Weighted-average
grant date fair value
per unit
|
|
Units
|
|
Weighted-average
fair value
per unit
|
|
Units
|
|
Weighted-average
grant date fair value
per unit
|
|||
|
(In millions, except per unit amounts)
|
|||||||||||||
Non-vested as of December 31, 2014
|
0.7
|
|
|
$47.75
|
|
0.5
|
|
|
$3.22
|
|
0.4
|
|
|
$50.49
|
Granted
|
0.2
|
|
|
$70.10
|
|
—
|
|
|
$—
|
|
0.1
|
|
|
$74.42
|
Vested
|
(0.2
|
)
|
|
$43.18
|
|
(0.5
|
)
|
|
$2.89
|
|
—
|
|
|
$—
|
Forfeited
|
—
|
|
|
$—
|
|
—
|
|
|
$—
|
|
—
|
|
|
$—
|
Non-vested as of March 31, 2015
|
0.7
|
|
|
$53.81
|
|
—
|
|
|
$—
|
|
0.5
|
|
|
$57.02
|
|
Shares outstanding
|
|
Weighted-average
exercise price per
share
|
|
Weighted-average
remaining contractual life
(years)
|
|
Aggregate
intrinsic value
|
||
|
(In millions, except per share amounts and years)
|
||||||||
Outstanding as of December 31, 2014
|
2.2
|
|
$45.33
|
|
5.0
|
|
$
|
64.6
|
|
Granted
|
0.1
|
|
$74.81
|
|
|
|
|
||
Exercised
|
(0.6)
|
|
$44.89
|
|
|
|
|
||
Forfeited
|
—
|
|
$—
|
|
|
|
|
||
Outstanding as of March 31, 2015
|
1.7
|
|
$47.87
|
|
5.0
|
|
$
|
44.7
|
|
Exercisable at March 31, 2015
|
1.4
|
|
$45.06
|
|
4.3
|
|
$
|
42.2
|
|
|
Three Months Ended
|
||
|
March 31, 2015
|
|
March 31, 2014
|
Risk-free interest rate
|
1.70%
|
|
2.29%
|
Dividend yield
|
2.20%
|
|
2.57%
|
Volatility range
|
21.65%-29.90%
|
|
22.66%-26.57%
|
Weighted-average volatility
|
23.71%
|
|
25.59%
|
Expected term (years)
|
5.7
|
|
7.5
|
Weighted-average fair market value
|
$13.98
|
|
$12.78
|
|
Three Months Ended
|
||
|
March 31, 2015
|
|
March 31, 2014
|
Risk-free interest rate
|
1.06%
|
|
0.72%
|
Dividend yield
|
2.20%
|
|
2.57%
|
Volatility range
|
12.73%-62.28%
|
|
12.45%-72.41%
|
Weighted-average volatility
|
21.53%
|
|
21.72%
|
Expected term (years)
|
2.8
|
|
2.8
|
Weighted-average fair market value
|
$74.42
|
|
$58.69
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions)
|
||||||
Employee-related restructuring charges
|
|
|
|
||||
Canada
|
$
|
—
|
|
|
$
|
5.3
|
|
Europe
|
(1.2
|
)
|
|
0.5
|
|
||
Impairments or asset abandonment charges
|
|
|
|
||||
Canada - Intangible asset write-off
(1)
|
—
|
|
|
4.9
|
|
||
Europe - Asset abandonment
(2)
|
11.8
|
|
|
—
|
|
||
Unusual or infrequent items
|
|
|
|
||||
Europe - Flood loss (insurance reimbursement), net
(3)
|
(2.0
|
)
|
|
—
|
|
||
Termination fees and other (gains)/losses
|
|
|
|
||||
Canada - Termination fee income
(1)
|
—
|
|
|
(63.2
|
)
|
||
Total Special items, net
|
$
|
8.6
|
|
|
$
|
(52.5
|
)
|
(1)
|
Upon termination of our MMI operations in the first quarter of 2014, we recognized termination fee income and charges associated with the write-off of the definite-lived intangible asset associated with the joint venture. See
Note 4, "Investments"
for further discussion.
|
(2)
|
In December 2013, we entered into an agreement with Heineken to early terminate our contract brewing and kegging agreement under which we produced and packaged the
Foster's
and
Kronenbourg
brands in the U.K. As a result of the termination, Heineken agreed to pay us an aggregate early termination payment of GBP
13.0 million
, of which we received GBP
5.0 million
(
$8.5 million
at payment date) in 2014 and the remaining GBP
8.0 million
(approximately
$12 million
at payment date) on April 30, 2015. The full amount of the termination payment will be recognized as income within special items at the end of the transition period in the second quarter of 2015. Additionally, the termination of this distribution agreement led to a strategic review of our European supply chain network. As part of this analysis, we decided to close the Alton brewery in the U.K., which we anticipate to be completed during the second quarter of 2015. As a result of this anticipated closure, we incurred accelerated depreciation expense in excess of our normal depreciation
|
(3)
|
During the
three
months ended
March 31, 2015
, we recorded
$2.0 million
of income for insurance proceeds received related to significant flooding in Czech Republic that occurred during the second quarter of 2013.
|
|
Canada
|
|
Europe
|
|
MCI
|
|
Corporate
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Total at December 31, 2014
|
$
|
3.8
|
|
|
$
|
11.5
|
|
|
$
|
—
|
|
|
$
|
0.2
|
|
|
$
|
15.5
|
|
Charges incurred
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Payments made
|
(1.4
|
)
|
|
(0.6
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
(2.2
|
)
|
|||||
Changes in estimates
|
—
|
|
|
(1.2
|
)
|
|
—
|
|
|
—
|
|
|
(1.2
|
)
|
|||||
Foreign currency and other adjustments
|
(0.3
|
)
|
|
(0.6
|
)
|
|
—
|
|
|
—
|
|
|
(0.9
|
)
|
|||||
Total at March 31, 2015
|
$
|
2.1
|
|
|
$
|
9.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
11.2
|
|
|
Canada
|
|
Europe
|
|
MCI
|
|
Corporate
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Total at December 31, 2013
|
$
|
9.7
|
|
|
$
|
13.6
|
|
|
$
|
0.5
|
|
|
$
|
0.9
|
|
|
$
|
24.7
|
|
Charges incurred
|
5.3
|
|
|
0.5
|
|
|
—
|
|
|
—
|
|
|
5.8
|
|
|||||
Payments made
|
(3.6
|
)
|
|
(0.6
|
)
|
|
(0.1
|
)
|
|
(0.2
|
)
|
|
(4.5
|
)
|
|||||
Foreign currency and other adjustments
|
(0.4
|
)
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|||||
Total at March 31, 2014
|
$
|
11.0
|
|
|
$
|
13.7
|
|
|
$
|
0.4
|
|
|
$
|
0.7
|
|
|
$
|
25.8
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions)
|
||||||
Gain (loss) from foreign exchange and derivative activity
|
$
|
(2.6
|
)
|
|
$
|
0.8
|
|
Other income (expense), net
|
$
|
(2.6
|
)
|
|
$
|
0.8
|
|
|
Three Months Ended
|
||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
(In millions, except per share amounts)
|
||||||
Amounts attributable to Molson Coors Brewing Company
|
|
|
|
||||
Net income (loss) from continuing operations
|
$
|
79.2
|
|
|
$
|
165.3
|
|
Income (loss) from discontinued operations, net of tax
|
1.9
|
|
|
(1.9
|
)
|
||
Net income (loss) attributable to Molson Coors Brewing Company
|
$
|
81.1
|
|
|
$
|
163.4
|
|
Weighted-average shares for basic EPS
|
185.8
|
|
|
184.3
|
|
||
Effect of dilutive securities:
|
|
|
|
||||
RSUs, DSUs, PUs and PSUs
|
0.5
|
|
|
0.6
|
|
||
Stock options and SOSARs
|
0.6
|
|
|
0.6
|
|
||
Weighted-average shares for diluted EPS
|
186.9
|
|
|
185.5
|
|
||
Basic net income (loss) attributable to Molson Coors Brewing Company per share
(1)
:
|
|
|
|
||||
From continuing operations
|
$
|
0.43
|
|
|
$
|
0.90
|
|
From discontinued operations
|
0.01
|
|
|
(0.01
|
)
|
||
Basic net income (loss) attributable to Molson Coors Brewing Company per share
|
$
|
0.44
|
|
|
$
|
0.89
|
|
Diluted net income (loss) attributable to Molson Coors Brewing Company per share
(1)
:
|
|
|
|
||||
From continuing operations
|
$
|
0.42
|
|
|
$
|
0.89
|
|
From discontinued operations
|
0.01
|
|
|
(0.01
|
)
|
||
Diluted net income (loss) attributable to Molson Coors Brewing Company per share
|
$
|
0.43
|
|
|
$
|
0.88
|
|
Dividends declared and paid per share
|
$
|
0.41
|
|
|
$
|
0.37
|
|
(1)
|
The sum of the quarterly net income per share amounts may not agree to the full year net income per share amounts. We calculate net income per share based on the weighted-average number of outstanding shares during the period for each reporting period presented. The average number of shares fluctuates throughout the year and can therefore produce a full year result that does not agree to the sum of the individual quarters.
|
|
Three Months Ended
|
||||
|
March 31, 2015
|
|
March 31, 2014
|
||
|
(In millions)
|
||||
RSUs, stock options and SOSARs
|
—
|
|
|
0.1
|
|
|
Canada
|
|
Europe
|
|
MCI
|
|
Consolidated
|
||||||||
|
(In millions)
|
||||||||||||||
Balance at December 31, 2014
|
$
|
656.5
|
|
|
$
|
1,528.0
|
|
|
$
|
7.1
|
|
|
$
|
2,191.6
|
|
Foreign currency translation
|
(55.1
|
)
|
|
(115.4
|
)
|
|
—
|
|
|
(170.5
|
)
|
||||
Balance at March 31, 2015
|
$
|
601.4
|
|
|
$
|
1,412.6
|
|
|
$
|
7.1
|
|
|
$
|
2,021.1
|
|
|
Useful life
|
|
Gross
|
|
Accumulated
amortization
|
|
Net
|
||||||
|
(Years)
|
|
(In millions)
|
||||||||||
Intangible assets subject to amortization:
|
|
|
|
|
|
|
|
||||||
Brands
|
3 - 40
|
|
$
|
444.5
|
|
|
$
|
(217.9
|
)
|
|
$
|
226.6
|
|
License agreements and distribution rights
|
3 - 28
|
|
102.6
|
|
|
(91.5
|
)
|
|
11.1
|
|
|||
Other
|
2 - 8
|
|
30.1
|
|
|
(28.2
|
)
|
|
1.9
|
|
|||
Intangible assets not subject to amortization:
|
|
|
|
|
|
|
|
||||||
Brands
|
Indefinite
|
|
4,175.0
|
|
|
—
|
|
|
4,175.0
|
|
|||
Distribution networks
|
Indefinite
|
|
797.4
|
|
|
—
|
|
|
797.4
|
|
|||
Other
|
Indefinite
|
|
17.5
|
|
|
—
|
|
|
17.5
|
|
|||
Total
|
|
|
$
|
5,567.1
|
|
|
$
|
(337.6
|
)
|
|
$
|
5,229.5
|
|
|
Useful life
|
|
Gross
|
|
Accumulated
amortization
|
|
Net
|
||||||
|
(Years)
|
|
(In millions)
|
||||||||||
Intangible assets subject to amortization:
|
|
|
|
|
|
|
|
||||||
Brands
|
3 - 40
|
|
$
|
483.5
|
|
|
$
|
(229.1
|
)
|
|
$
|
254.4
|
|
License agreements and distribution rights
|
3 - 28
|
|
122.0
|
|
|
(101.1
|
)
|
|
20.9
|
|
|||
Other
|
2 - 8
|
|
31.7
|
|
|
(29.4
|
)
|
|
2.3
|
|
|||
Intangible assets not subject to amortization:
|
|
|
|
|
|
|
|
||||||
Brands
|
Indefinite
|
|
4,590.2
|
|
|
—
|
|
|
4,590.2
|
|
|||
Distribution networks
|
Indefinite
|
|
870.5
|
|
|
—
|
|
|
870.5
|
|
|||
Other
|
Indefinite
|
|
17.5
|
|
|
—
|
|
|
17.5
|
|
|||
Total
|
|
|
$
|
6,115.4
|
|
|
$
|
(359.6
|
)
|
|
$
|
5,755.8
|
|
Fiscal year
|
Amount
|
||
|
(In millions)
|
||
2015 - remaining
|
$
|
17.0
|
|
2016
|
$
|
22.7
|
|
2017
|
$
|
11.5
|
|
2018
|
$
|
10.0
|
|
2019
|
$
|
10.0
|
|
|
As of
|
||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Senior notes:
|
|
|
|
||||
Canadian Dollar ("CAD") 900 million 5.0% notes due 2015
|
$
|
709.4
|
|
|
$
|
774.5
|
|
CAD 500 million 3.95% Series A notes due 2017
|
394.1
|
|
|
430.3
|
|
||
$300 million 2.0% notes due 2017
(1)
|
300.6
|
|
|
300.0
|
|
||
$500 million 3.5% notes due 2022
(1)
|
519.2
|
|
|
510.8
|
|
||
$1.1 billion 5.0% notes due 2042
|
1,100.0
|
|
|
1,100.0
|
|
||
Long-term credit facilities
(2)
|
—
|
|
|
—
|
|
||
Less: unamortized debt discounts
|
(3.9
|
)
|
|
(4.2
|
)
|
||
Total long-term debt (including current portion)
|
3,019.4
|
|
|
3,111.4
|
|
||
Less: current portion of long-term debt
|
(709.3
|
)
|
|
(774.3
|
)
|
||
Total long-term debt
|
$
|
2,310.1
|
|
|
$
|
2,337.1
|
|
|
|
|
|
||||
Short-term borrowings:
|
|
|
|
||||
Commercial paper program
(3)
|
$
|
127.8
|
|
|
$
|
—
|
|
Overdraft facility
(4)
|
59.0
|
|
|
64.6
|
|
||
Short-term facilities
(5)
:
|
|
|
|
||||
Japanese Yen ("JPY") 1.5 billion line of credit
|
4.6
|
|
|
4.9
|
|
||
Euro ("EUR") 100 million revolving credit facility
|
26.8
|
|
|
—
|
|
||
Other short-term borrowings
|
13.7
|
|
|
5.6
|
|
||
Current portion of long-term debt
|
709.3
|
|
|
774.3
|
|
||
Current portion of long-term debt and short-term borrowings
|
$
|
941.2
|
|
|
$
|
849.4
|
|
(1)
|
In the first quarter of 2015, we entered into interest rate swaps to economically convert our fixed rate
$300 million
2.0%
notes due 2017 ("
$300 million
notes") to floating rate debt consistent with our
$500 million
3.5%
notes due 2022 ("
$500 million
notes") entered into during 2014. As a result of these hedge programs, the carrying value of the
$300 million
and
$500 million
notes include adjustments of
$0.6 million
and
$19.2 million
, respectively, for fair value movements attributable to the benchmark interest rate.
|
(2)
|
As of
March 31, 2015
, we have
$622.2 million
available to draw on under our
$750 million
revolving credit facility, as the borrowing capacity is reduced by borrowings under our commercial paper program discussed below.
|
(3)
|
As of
March 31, 2015
, the weighted-average effective interest rate and tenor for the outstanding commercial paper borrowings was
0.53%
and
26.1
days, respectively. There were no outstanding borrowings under the commercial paper program as of
December 31, 2014
.
|
(4)
|
As of
March 31, 2015
, we had
$59.0 million
in bank overdrafts and
$59.9 million
in bank cash related to our European cross-border, cross-currency cash pool for a net positive position of
$0.9 million
. As of
December 31, 2014
, we had
$64.6 million
in bank overdrafts and
$80.0 million
in bank cash related to our European cross-border, cross-currency cash pool for a net positive position of
$15.4 million
.
|
(5)
|
In addition to our JPY line of credit and EUR revolving credit facility, we have British Pound ("GBP") and CAD overdraft facilities which we had no borrowings under as of
March 31, 2015
, or
December 31, 2014
.
|
|
MCBC shareholders
|
||||||||||||||||||
|
Foreign
currency
translation
adjustments
|
|
Gain (loss) on
derivative
instruments
|
|
Pension and
postretirement
benefit
adjustments
|
|
Equity method
investments
|
|
Accumulated
other
comprehensive
income (loss)
|
||||||||||
|
(In millions)
|
||||||||||||||||||
As of December 31, 2014
|
$
|
129.8
|
|
|
$
|
15.0
|
|
|
$
|
(658.5
|
)
|
|
$
|
(384.7
|
)
|
|
$
|
(898.4
|
)
|
Foreign currency translation adjustments
|
(626.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(626.8
|
)
|
|||||
Unrealized gain (loss) on derivative instruments
|
—
|
|
|
21.3
|
|
|
—
|
|
|
—
|
|
|
21.3
|
|
|||||
Reclassification of derivative (gain) loss to income
|
—
|
|
|
(2.0
|
)
|
|
—
|
|
|
—
|
|
|
(2.0
|
)
|
|||||
Pension and other postretirement benefit adjustments
|
—
|
|
|
—
|
|
|
(2.2
|
)
|
|
—
|
|
|
(2.2
|
)
|
|||||
Amortization of net prior service (benefit) cost and net actuarial (gain) loss to income
|
—
|
|
|
—
|
|
|
11.3
|
|
|
—
|
|
|
11.3
|
|
|||||
Ownership share of unconsolidated subsidiaries' other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
3.4
|
|
|
3.4
|
|
|||||
Tax benefit (expense)
|
(37.5
|
)
|
|
(1.8
|
)
|
|
(1.9
|
)
|
|
(1.2
|
)
|
|
(42.4
|
)
|
|||||
As of March 31, 2015
|
$
|
(534.5
|
)
|
|
$
|
32.5
|
|
|
$
|
(651.3
|
)
|
|
$
|
(382.5
|
)
|
|
$
|
(1,535.8
|
)
|
|
|
Three Months Ended
|
|
|
||||||
|
|
March 31, 2015
|
|
March 31, 2014
|
|
|
||||
|
|
Reclassifications from AOCI
|
|
Location of gain (loss)
recognized in income
|
||||||
|
|
(In millions)
|
|
|
||||||
Gain/(loss) on cash flow hedges:
|
|
|
|
|
|
|
||||
Forward starting interest rate swaps
|
|
$
|
(0.3
|
)
|
|
$
|
(0.4
|
)
|
|
Interest expense, net
|
Foreign currency forwards
|
|
(2.4
|
)
|
|
1.6
|
|
|
Other income (expense), net
|
||
Foreign currency forwards
|
|
4.7
|
|
|
3.3
|
|
|
Cost of goods sold
|
||
Commodity swaps
|
|
—
|
|
|
0.2
|
|
|
Cost of goods sold
|
||
Total income (loss) reclassified, before tax
|
|
2.0
|
|
|
4.7
|
|
|
|
||
Income tax benefit (expense)
|
|
(0.6
|
)
|
|
(1.5
|
)
|
|
|
||
Net income (loss) reclassified, net of tax
|
|
$
|
1.4
|
|
|
$
|
3.2
|
|
|
|
|
|
|
|
|
|
|
||||
Amortization of defined benefit pension and other postretirement benefit plan items:
|
|
|
|
|
|
|
||||
Prior service benefit (cost)
|
|
$
|
(0.1
|
)
|
|
$
|
0.6
|
|
|
(1)
|
Net actuarial gain (loss)
|
|
(11.2
|
)
|
|
(8.9
|
)
|
|
(1)
|
||
Total income (loss) reclassified, before tax
|
|
(11.3
|
)
|
|
(8.3
|
)
|
|
|
||
Income tax benefit (expense)
|
|
2.3
|
|
|
0.7
|
|
|
|
||
Net income (loss) reclassified, net of tax
|
|
$
|
(9.0
|
)
|
|
$
|
(7.6
|
)
|
|
|
|
|
|
|
|
|
|
||||
Total income (loss) reclassified, net of tax
|
|
$
|
(7.6
|
)
|
|
$
|
(4.4
|
)
|
|
|
(1)
|
These components of AOCI are included in the computation of net periodic pension and other postretirement benefit cost. See
Note 14, "Pension and Other Postretirement Benefits"
for additional details.
|
|
|
|
Fair value measurements as of March 31, 2015
|
||||||||||||
|
Total at March 31, 2015
|
|
Quoted prices in
active markets
(Level 1)
|
|
Significant other
observable inputs
(Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
||||||||
|
(In millions)
|
||||||||||||||
Cross currency swap
|
$
|
15.9
|
|
|
$
|
—
|
|
|
$
|
15.9
|
|
|
$
|
—
|
|
Interest rate swaps
|
(7.1
|
)
|
|
—
|
|
|
(7.1
|
)
|
|
—
|
|
||||
Foreign currency forwards
|
49.7
|
|
|
—
|
|
|
49.7
|
|
|
—
|
|
||||
Commodity swaps
|
(8.2
|
)
|
|
—
|
|
|
(8.2
|
)
|
|
—
|
|
||||
Total
|
$
|
50.3
|
|
|
$
|
—
|
|
|
$
|
50.3
|
|
|
$
|
—
|
|
|
|
|
Fair value measurements as of December 31, 2014
|
||||||||||||
|
Total at December 31, 2014
|
|
Quoted prices in
active markets
(Level 1)
|
|
Significant other
observable inputs
(Level 2)
|
|
Significant
unobservable
inputs (Level 3)
|
||||||||
|
(In millions)
|
||||||||||||||
Interest rate swaps
|
$
|
(2.2
|
)
|
|
$
|
—
|
|
|
$
|
(2.2
|
)
|
|
$
|
—
|
|
Foreign currency forwards
|
31.6
|
|
|
—
|
|
|
31.6
|
|
|
—
|
|
||||
Commodity swaps
|
(8.9
|
)
|
|
—
|
|
|
(8.9
|
)
|
|
—
|
|
||||
Total
|
$
|
20.5
|
|
|
$
|
—
|
|
|
$
|
20.5
|
|
|
$
|
—
|
|
For the Three Months Ended March 31, 2015
|
||||||||||||||||
Derivatives in cash flow hedge relationships
|
|
Amount of gain
(loss) recognized
in OCI on
derivative
(effective
portion)
|
|
Location of gain (loss)
reclassified from AOCI into
income (effective portion)
|
|
Amount of gain
(loss) recognized
from AOCI on
derivative
(effective portion)
|
|
Location of gain (loss)
recognized in income on
derivative (ineffective portion
and amount excluded from
effectiveness testing)
|
|
Amount of gain (loss)
recognized in income
on derivative
(ineffective portion and
amount excluded from
effectiveness testing)
|
||||||
Forward starting interest rate swaps
|
|
$
|
(15.7
|
)
|
|
Interest expense, net
|
|
$
|
(0.3
|
)
|
|
Interest expense, net
|
|
$
|
—
|
|
Foreign currency forwards
|
|
21.5
|
|
|
Other income (expense), net
|
|
(2.4
|
)
|
|
Other income (expense), net
|
|
—
|
|
|||
|
|
|
|
|
Cost of goods sold
|
|
4.7
|
|
|
Cost of goods sold
|
|
—
|
|
|||
Total
|
|
$
|
5.8
|
|
|
|
|
$
|
2.0
|
|
|
|
|
$
|
—
|
|
For the Three Months Ended March 31, 2015
|
||||||||||||||||
Derivatives and non-derivative financial instruments in net investment hedge relationships
|
|
Amount of gain
(loss) recognized in
OCI (effective portion)
|
|
Location of gain (loss)
reclassified from AOCI into
income (effective portion)
|
|
Amount of gain
(loss) recognized
from AOCI
(effective portion)
|
|
Location of gain (loss)
recognized in income
(ineffective portion
and amount excluded from
effectiveness testing)
|
|
Amount of gain (loss)
recognized in income
(ineffective portion and
amount excluded from
effectiveness testing)
|
||||||
Cross currency swap
|
|
$
|
15.5
|
|
|
Interest expense, net
|
|
$
|
—
|
|
|
Interest expense, net
|
|
$
|
0.4
|
|
Total
|
|
$
|
15.5
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
0.4
|
|
For the Three Months Ended March 31, 2014
|
||||||||||||||||
Derivatives in cash flow hedge relationships
|
|
Amount of gain
(loss) recognized
in OCI on
derivative
(effective
portion)
|
|
Location of gain (loss)
reclassified from AOCI into
income (effective portion)
|
|
Amount of gain
(loss) recognized
from AOCI on
derivative
(effective portion)
|
|
Location of gain (loss)
recognized in income on
derivative (ineffective portion
and amount excluded from
effectiveness testing)
|
|
Amount of gain (loss)
recognized in income
on derivative
(ineffective portion and
amount excluded from
effectiveness testing)
|
||||||
Forward starting interest rate swaps
|
|
$
|
—
|
|
|
Interest expense, net
|
|
$
|
(0.4
|
)
|
|
Interest expense, net
|
|
$
|
—
|
|
Foreign currency forwards
|
|
14.7
|
|
|
Other income (expense), net
|
|
1.6
|
|
|
Other income (expense), net
|
|
—
|
|
|||
|
|
|
|
|
Cost of goods sold
|
|
3.3
|
|
|
Cost of goods sold
|
|
—
|
|
|||
Commodity swaps
|
|
0.3
|
|
|
Cost of goods sold
|
|
0.2
|
|
|
Cost of goods sold
|
|
—
|
|
|||
Total
|
|
$
|
15.0
|
|
|
|
|
$
|
4.7
|
|
|
|
|
$
|
—
|
|
For the Three Months Ended March 31, 2014
|
||||||||||||||||
Derivatives and non-derivative financial instruments in net investment hedge relationships
|
|
Amount of gain
(loss) recognized in
OCI (effective portion)
|
|
Location of gain (loss)
reclassified from AOCI into
income (effective portion)
|
|
Amount of gain
(loss) recognized
from AOCI
(effective portion)
|
|
Location of gain (loss)
recognized in income
(ineffective portion
and amount excluded from
effectiveness testing)
|
|
Amount of gain (loss)
recognized in income
(ineffective portion and
amount excluded from
effectiveness testing)
|
||||||
Cross currency swap
|
|
$
|
6.5
|
|
|
Other income (expense), net
|
|
$
|
—
|
|
|
Other income (expense), net
|
|
$
|
—
|
|
Total
|
|
$
|
6.5
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended March 31, 2015
|
||||||
Derivatives not in hedging relationships
|
|
Location of gain (loss) recognized in
income on derivative
|
|
Amount of gain (loss) recognized in
income on derivative
|
||
Commodity swaps
|
|
Cost of goods sold
|
|
$
|
(0.6
|
)
|
Foreign currency forwards
|
|
Other income (expense), net
|
|
1.2
|
|
|
Total
|
|
|
|
$
|
0.6
|
|
For the Three Months Ended March 31, 2014
|
||||||
Derivatives not in hedging relationships
|
|
Location of gain (loss) recognized in
income on derivative
|
|
Amount of gain (loss) recognized in
income on derivative
|
||
Commodity Swaps
|
|
Cost of goods sold
|
|
$
|
(1.3
|
)
|
Total
|
|
|
|
$
|
(1.3
|
)
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months Ended
|
||||||||||||||||||||||
|
March 31, 2015
|
|
March 31, 2014
|
||||||||||||||||||||
|
Pension
|
|
OPEB
|
|
Consolidated
|
|
Pension
|
|
OPEB
|
|
Consolidated
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Net periodic pension and OPEB cost:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost - benefits earned during the year
|
$
|
2.6
|
|
|
$
|
0.5
|
|
|
$
|
3.1
|
|
|
$
|
3.3
|
|
|
$
|
0.7
|
|
|
$
|
4.0
|
|
Interest cost on projected benefit obligation
|
34.4
|
|
|
1.5
|
|
|
35.9
|
|
|
42.1
|
|
|
1.7
|
|
|
43.8
|
|
||||||
Expected return on plan assets
|
(44.1
|
)
|
|
—
|
|
|
(44.1
|
)
|
|
(49.1
|
)
|
|
—
|
|
|
(49.1
|
)
|
||||||
Amortization of prior service cost (benefit)
|
0.2
|
|
|
(0.1
|
)
|
|
0.1
|
|
|
0.2
|
|
|
(0.8
|
)
|
|
(0.6
|
)
|
||||||
Amortization of net actuarial loss (gain)
|
11.2
|
|
|
—
|
|
|
11.2
|
|
|
9.1
|
|
|
(0.2
|
)
|
|
8.9
|
|
||||||
Curtailment (gain) loss
|
(1.0
|
)
|
|
—
|
|
|
(1.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Less: expected participant contributions
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
|
(0.3
|
)
|
|
—
|
|
|
(0.3
|
)
|
||||||
Net periodic pension and OPEB cost
|
$
|
3.1
|
|
|
$
|
1.9
|
|
|
$
|
5.0
|
|
|
$
|
5.3
|
|
|
$
|
1.4
|
|
|
$
|
6.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
•
|
trust management costs are included in projections with regard to the
$120 million
threshold, but are expensed only as incurred;
|
•
|
income taxes, which we believe are not an included cost, are excluded from projections with regard to the
$120 million
threshold;
|
•
|
a
2.5%
inflation rate for future costs; and
|
•
|
certain operations and maintenance costs were discounted using a
2.24%
risk-free rate of return.
|
|
Parent
Guarantor and
2012 Issuer
|
|
Subsidiary
Guarantors
|
|
Subsidiary
Non
Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Sales
|
$
|
4.9
|
|
|
$
|
823.8
|
|
|
$
|
207.6
|
|
|
$
|
(33.1
|
)
|
|
$
|
1,003.2
|
|
Excise taxes
|
—
|
|
|
(256.9
|
)
|
|
(46.3
|
)
|
|
—
|
|
|
(303.2
|
)
|
|||||
Net sales
|
4.9
|
|
|
566.9
|
|
|
161.3
|
|
|
(33.1
|
)
|
|
700.0
|
|
|||||
Cost of goods sold
|
—
|
|
|
(361.3
|
)
|
|
(116.1
|
)
|
|
22.6
|
|
|
(454.8
|
)
|
|||||
Gross profit
|
4.9
|
|
|
205.6
|
|
|
45.2
|
|
|
(10.5
|
)
|
|
245.2
|
|
|||||
Marketing, general and administrative expenses
|
(28.1
|
)
|
|
(153.0
|
)
|
|
(70.0
|
)
|
|
10.5
|
|
|
(240.6
|
)
|
|||||
Special items, net
|
—
|
|
|
(10.6
|
)
|
|
2.0
|
|
|
—
|
|
|
(8.6
|
)
|
|||||
Equity income (loss) in subsidiaries
|
104.2
|
|
|
(92.4
|
)
|
|
23.6
|
|
|
(35.4
|
)
|
|
—
|
|
|||||
Equity income in MillerCoors
|
—
|
|
|
129.3
|
|
|
—
|
|
|
—
|
|
|
129.3
|
|
|||||
Operating income (loss)
|
81.0
|
|
|
78.9
|
|
|
0.8
|
|
|
(35.4
|
)
|
|
125.3
|
|
|||||
Interest income (expense), net
|
(17.2
|
)
|
|
58.9
|
|
|
(70.9
|
)
|
|
—
|
|
|
(29.2
|
)
|
|||||
Other income (expense), net
|
(1.3
|
)
|
|
(2.3
|
)
|
|
1.0
|
|
|
—
|
|
|
(2.6
|
)
|
|||||
Income (loss) from continuing operations before income taxes
|
62.5
|
|
|
135.5
|
|
|
(69.1
|
)
|
|
(35.4
|
)
|
|
93.5
|
|
|||||
Income tax benefit (expense)
|
18.6
|
|
|
(30.9
|
)
|
|
(0.5
|
)
|
|
—
|
|
|
(12.8
|
)
|
|||||
Net income (loss) from continuing operations
|
81.1
|
|
|
104.6
|
|
|
(69.6
|
)
|
|
(35.4
|
)
|
|
80.7
|
|
|||||
Income (loss) from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
1.9
|
|
|
—
|
|
|
1.9
|
|
|||||
Net income (loss) including noncontrolling interests
|
81.1
|
|
|
104.6
|
|
|
(67.7
|
)
|
|
(35.4
|
)
|
|
82.6
|
|
|||||
Net (income) loss attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
(1.5
|
)
|
|
—
|
|
|
(1.5
|
)
|
|||||
Net income (loss) attributable to MCBC
|
$
|
81.1
|
|
|
$
|
104.6
|
|
|
$
|
(69.2
|
)
|
|
$
|
(35.4
|
)
|
|
$
|
81.1
|
|
Comprehensive income (loss) attributable to MCBC
|
$
|
(556.3
|
)
|
|
$
|
(505.4
|
)
|
|
$
|
(293.8
|
)
|
|
$
|
799.2
|
|
|
$
|
(556.3
|
)
|
|
Parent
Guarantor and
2012 Issuer
|
|
Subsidiary
Guarantors
|
|
Subsidiary
Non
Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Sales
|
$
|
8.0
|
|
|
$
|
950.8
|
|
|
$
|
259.0
|
|
|
$
|
(39.5
|
)
|
|
$
|
1,178.3
|
|
Excise taxes
|
—
|
|
|
(304.9
|
)
|
|
(57.4
|
)
|
|
—
|
|
|
(362.3
|
)
|
|||||
Net sales
|
8.0
|
|
|
645.9
|
|
|
201.6
|
|
|
(39.5
|
)
|
|
816.0
|
|
|||||
Cost of goods sold
|
—
|
|
|
(404.7
|
)
|
|
(142.8
|
)
|
|
24.3
|
|
|
(523.2
|
)
|
|||||
Gross profit
|
8.0
|
|
|
241.2
|
|
|
58.8
|
|
|
(15.2
|
)
|
|
292.8
|
|
|||||
Marketing, general and administrative expenses
|
(31.2
|
)
|
|
(173.8
|
)
|
|
(74.1
|
)
|
|
15.2
|
|
|
(263.9
|
)
|
|||||
Special items, net
|
—
|
|
|
(10.7
|
)
|
|
63.2
|
|
|
—
|
|
|
52.5
|
|
|||||
Equity income (loss) in subsidiaries
|
201.4
|
|
|
(33.7
|
)
|
|
21.2
|
|
|
(188.9
|
)
|
|
—
|
|
|||||
Equity income in MillerCoors
|
—
|
|
|
122.8
|
|
|
—
|
|
|
—
|
|
|
122.8
|
|
|||||
Operating income (loss)
|
178.2
|
|
|
145.8
|
|
|
69.1
|
|
|
(188.9
|
)
|
|
204.2
|
|
|||||
Interest income (expense), net
|
(21.4
|
)
|
|
75.8
|
|
|
(89.8
|
)
|
|
—
|
|
|
(35.4
|
)
|
|||||
Other income (expense), net
|
0.3
|
|
|
2.0
|
|
|
(1.5
|
)
|
|
—
|
|
|
0.8
|
|
|||||
Income (loss) from continuing operations before income taxes
|
157.1
|
|
|
223.6
|
|
|
(22.2
|
)
|
|
(188.9
|
)
|
|
169.6
|
|
|||||
Income tax benefit (expense)
|
6.3
|
|
|
(15.3
|
)
|
|
4.2
|
|
|
—
|
|
|
(4.8
|
)
|
|||||
Net income (loss) from continuing operations
|
163.4
|
|
|
208.3
|
|
|
(18.0
|
)
|
|
(188.9
|
)
|
|
164.8
|
|
|||||
Income (loss) from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
(1.9
|
)
|
|
—
|
|
|
(1.9
|
)
|
|||||
Net income (loss) including noncontrolling interests
|
163.4
|
|
|
208.3
|
|
|
(19.9
|
)
|
|
(188.9
|
)
|
|
162.9
|
|
|||||
Net (income) loss attributable to noncontrolling interests
|
—
|
|
|
—
|
|
|
0.5
|
|
|
—
|
|
|
0.5
|
|
|||||
Net income (loss) attributable to MCBC
|
$
|
163.4
|
|
|
$
|
208.3
|
|
|
$
|
(19.4
|
)
|
|
$
|
(188.9
|
)
|
|
$
|
163.4
|
|
Comprehensive income (loss) attributable to MCBC
|
$
|
1.9
|
|
|
$
|
94.0
|
|
|
$
|
(21.9
|
)
|
|
$
|
(72.1
|
)
|
|
$
|
1.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Parent
Guarantor and
2012 Issuer
|
|
Subsidiary
Guarantors
|
|
Subsidiary
Non
Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
50.1
|
|
|
$
|
168.8
|
|
|
$
|
98.7
|
|
|
$
|
—
|
|
|
$
|
317.6
|
|
Accounts receivable, net
|
—
|
|
|
329.8
|
|
|
129.3
|
|
|
—
|
|
|
459.1
|
|
|||||
Other receivables, net
|
53.5
|
|
|
56.2
|
|
|
21.5
|
|
|
—
|
|
|
131.2
|
|
|||||
Total inventories
|
—
|
|
|
188.8
|
|
|
40.4
|
|
|
—
|
|
|
229.2
|
|
|||||
Other current assets, net
|
5.6
|
|
|
67.6
|
|
|
41.6
|
|
|
—
|
|
|
114.8
|
|
|||||
Deferred tax assets
|
2.1
|
|
|
0.9
|
|
|
29.8
|
|
|
(6.6
|
)
|
|
26.2
|
|
|||||
Intercompany accounts receivable
|
—
|
|
|
3,353.7
|
|
|
263.0
|
|
|
(3,616.7
|
)
|
|
—
|
|
|||||
Total current assets
|
111.3
|
|
|
4,165.8
|
|
|
624.3
|
|
|
(3,623.3
|
)
|
|
1,278.1
|
|
|||||
Properties, net
|
27.9
|
|
|
1,064.8
|
|
|
547.9
|
|
|
—
|
|
|
1,640.6
|
|
|||||
Goodwill
|
—
|
|
|
1,023.8
|
|
|
997.3
|
|
|
—
|
|
|
2,021.1
|
|
|||||
Other intangibles, net
|
—
|
|
|
3,559.4
|
|
|
1,670.1
|
|
|
—
|
|
|
5,229.5
|
|
|||||
Investment in MillerCoors
|
—
|
|
|
2,499.1
|
|
|
—
|
|
|
—
|
|
|
2,499.1
|
|
|||||
Net investment in and advances to subsidiaries
|
12,054.7
|
|
|
3,697.4
|
|
|
5,622.2
|
|
|
(21,374.3
|
)
|
|
—
|
|
|||||
Deferred tax assets
|
12.9
|
|
|
15.3
|
|
|
0.1
|
|
|
12.2
|
|
|
40.5
|
|
|||||
Other assets, net
|
55.9
|
|
|
143.0
|
|
|
43.9
|
|
|
—
|
|
|
242.8
|
|
|||||
Total assets
|
$
|
12,262.7
|
|
|
$
|
16,168.6
|
|
|
$
|
9,505.8
|
|
|
$
|
(24,985.4
|
)
|
|
$
|
12,951.7
|
|
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other current liabilities
|
$
|
59.8
|
|
|
$
|
753.9
|
|
|
$
|
311.2
|
|
|
$
|
—
|
|
|
$
|
1,124.9
|
|
Deferred tax liabilities
|
—
|
|
|
189.6
|
|
|
—
|
|
|
(6.6
|
)
|
|
183.0
|
|
|||||
Current portion of long-term debt and short-term borrowings
|
127.8
|
|
|
709.3
|
|
|
104.1
|
|
|
—
|
|
|
941.2
|
|
|||||
Discontinued operations
|
—
|
|
|
—
|
|
|
5.0
|
|
|
—
|
|
|
5.0
|
|
|||||
Intercompany accounts payable
|
2,878.7
|
|
|
310.4
|
|
|
427.6
|
|
|
(3,616.7
|
)
|
|
—
|
|
|||||
Total current liabilities
|
3,066.3
|
|
|
1,963.2
|
|
|
847.9
|
|
|
(3,623.3
|
)
|
|
2,254.1
|
|
|||||
Long-term debt
|
1,916.4
|
|
|
393.7
|
|
|
—
|
|
|
—
|
|
|
2,310.1
|
|
|||||
Pension and postretirement benefits
|
3.0
|
|
|
265.1
|
|
|
5.8
|
|
|
—
|
|
|
273.9
|
|
|||||
Deferred tax liabilities
|
—
|
|
|
—
|
|
|
705.2
|
|
|
12.2
|
|
|
717.4
|
|
|||||
Other liabilities
|
17.0
|
|
|
43.8
|
|
|
37.5
|
|
|
—
|
|
|
98.3
|
|
|||||
Discontinued operations
|
—
|
|
|
—
|
|
|
12.8
|
|
|
—
|
|
|
12.8
|
|
|||||
Intercompany notes payable
|
—
|
|
|
1,200.5
|
|
|
5,216.6
|
|
|
(6,417.1
|
)
|
|
—
|
|
|||||
Total liabilities
|
5,002.7
|
|
|
3,866.3
|
|
|
6,825.8
|
|
|
(10,028.2
|
)
|
|
5,666.6
|
|
|||||
MCBC stockholders' equity
|
7,261.1
|
|
|
17,517.8
|
|
|
3,856.5
|
|
|
(21,374.3
|
)
|
|
7,261.1
|
|
|||||
Intercompany notes receivable
|
(1.1
|
)
|
|
(5,215.5
|
)
|
|
(1,200.5
|
)
|
|
6,417.1
|
|
|
—
|
|
|||||
Total stockholders' equity
|
7,260.0
|
|
|
12,302.3
|
|
|
2,656.0
|
|
|
(14,957.2
|
)
|
|
7,261.1
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
24.0
|
|
|
—
|
|
|
24.0
|
|
|||||
Total equity
|
7,260.0
|
|
|
12,302.3
|
|
|
2,680.0
|
|
|
(14,957.2
|
)
|
|
7,285.1
|
|
|||||
Total liabilities and equity
|
$
|
12,262.7
|
|
|
$
|
16,168.6
|
|
|
$
|
9,505.8
|
|
|
$
|
(24,985.4
|
)
|
|
$
|
12,951.7
|
|
|
Parent
Guarantor and
2012 Issuer
|
|
Subsidiary
Guarantors
|
|
Subsidiary
Non
Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
40.9
|
|
|
$
|
470.7
|
|
|
$
|
113.0
|
|
|
$
|
—
|
|
|
$
|
624.6
|
|
Accounts receivable, net
|
2.3
|
|
|
391.0
|
|
|
134.4
|
|
|
—
|
|
|
527.7
|
|
|||||
Other receivables, net
|
17.4
|
|
|
50.3
|
|
|
26.3
|
|
|
—
|
|
|
94.0
|
|
|||||
Total inventories
|
—
|
|
|
170.1
|
|
|
32.1
|
|
|
—
|
|
|
202.2
|
|
|||||
Other current assets, net
|
7.0
|
|
|
55.4
|
|
|
40.8
|
|
|
—
|
|
|
103.2
|
|
|||||
Deferred tax assets
|
2.2
|
|
|
—
|
|
|
31.6
|
|
|
(6.6
|
)
|
|
27.2
|
|
|||||
Intercompany accounts receivable
|
—
|
|
|
3,313.0
|
|
|
251.8
|
|
|
(3,564.8
|
)
|
|
—
|
|
|||||
Total current assets
|
69.8
|
|
|
4,450.5
|
|
|
630.0
|
|
|
(3,571.4
|
)
|
|
1,578.9
|
|
|||||
Properties, net
|
26.9
|
|
|
1,161.4
|
|
|
609.7
|
|
|
—
|
|
|
1,798.0
|
|
|||||
Goodwill
|
—
|
|
|
1,085.2
|
|
|
1,106.4
|
|
|
—
|
|
|
2,191.6
|
|
|||||
Other intangibles, net
|
—
|
|
|
3,883.9
|
|
|
1,871.9
|
|
|
—
|
|
|
5,755.8
|
|
|||||
Investment in MillerCoors
|
—
|
|
|
2,388.6
|
|
|
—
|
|
|
—
|
|
|
2,388.6
|
|
|||||
Net investment in and advances to subsidiaries
|
12,582.8
|
|
|
3,618.6
|
|
|
5,998.2
|
|
|
(22,199.6
|
)
|
|
—
|
|
|||||
Deferred tax assets
|
21.3
|
|
|
23.4
|
|
|
1.2
|
|
|
12.3
|
|
|
58.2
|
|
|||||
Other assets, net
|
31.1
|
|
|
144.7
|
|
|
49.4
|
|
|
—
|
|
|
225.2
|
|
|||||
Total assets
|
$
|
12,731.9
|
|
|
$
|
16,756.3
|
|
|
$
|
10,266.8
|
|
|
$
|
(25,758.7
|
)
|
|
$
|
13,996.3
|
|
Liabilities and equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other current liabilities
|
$
|
61.9
|
|
|
$
|
903.3
|
|
|
$
|
339.8
|
|
|
$
|
—
|
|
|
$
|
1,305.0
|
|
Deferred tax liabilities
|
—
|
|
|
171.4
|
|
|
—
|
|
|
(6.6
|
)
|
|
164.8
|
|
|||||
Current portion of long-term debt and short-term borrowings
|
—
|
|
|
774.3
|
|
|
75.1
|
|
|
—
|
|
|
849.4
|
|
|||||
Discontinued operations
|
—
|
|
|
—
|
|
|
6.1
|
|
|
—
|
|
|
6.1
|
|
|||||
Intercompany accounts payable
|
2,881.1
|
|
|
312.8
|
|
|
370.9
|
|
|
(3,564.8
|
)
|
|
—
|
|
|||||
Total current liabilities
|
2,943.0
|
|
|
2,161.8
|
|
|
791.9
|
|
|
(3,571.4
|
)
|
|
2,325.3
|
|
|||||
Long-term debt
|
1,907.3
|
|
|
429.8
|
|
|
—
|
|
|
—
|
|
|
2,337.1
|
|
|||||
Pension and postretirement benefits
|
2.9
|
|
|
534.0
|
|
|
6.0
|
|
|
—
|
|
|
542.9
|
|
|||||
Deferred tax liabilities
|
—
|
|
|
—
|
|
|
772.0
|
|
|
12.3
|
|
|
784.3
|
|
|||||
Other liabilities
|
16.6
|
|
|
45.8
|
|
|
42.7
|
|
|
—
|
|
|
105.1
|
|
|||||
Discontinued operations
|
—
|
|
|
—
|
|
|
15.5
|
|
|
—
|
|
|
15.5
|
|
|||||
Intercompany notes payable
|
—
|
|
|
1,211.9
|
|
|
5,669.5
|
|
|
(6,881.4
|
)
|
|
—
|
|
|||||
Total liabilities
|
4,869.8
|
|
|
4,383.3
|
|
|
7,297.6
|
|
|
(10,440.5
|
)
|
|
6,110.2
|
|
|||||
MCBC stockholders' equity
|
7,863.3
|
|
|
18,041.3
|
|
|
4,158.3
|
|
|
(22,199.6
|
)
|
|
7,863.3
|
|
|||||
Intercompany notes receivable
|
(1.2
|
)
|
|
(5,668.3
|
)
|
|
(1,211.9
|
)
|
|
6,881.4
|
|
|
—
|
|
|||||
Total stockholders' equity
|
7,862.1
|
|
|
12,373.0
|
|
|
2,946.4
|
|
|
(15,318.2
|
)
|
|
7,863.3
|
|
|||||
Noncontrolling interests
|
—
|
|
|
—
|
|
|
22.8
|
|
|
—
|
|
|
22.8
|
|
|||||
Total equity
|
7,862.1
|
|
|
12,373.0
|
|
|
2,969.2
|
|
|
(15,318.2
|
)
|
|
7,886.1
|
|
|||||
Total liabilities and equity
|
$
|
12,731.9
|
|
|
$
|
16,756.3
|
|
|
$
|
10,266.8
|
|
|
$
|
(25,758.7
|
)
|
|
$
|
13,996.3
|
|
|
Parent
Guarantor and
2012 Issuer
|
|
Subsidiary
Guarantors
|
|
Subsidiary
Non
Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net cash provided by (used in) operating activities
|
$
|
(77.7
|
)
|
|
$
|
(87.0
|
)
|
|
$
|
(37.9
|
)
|
|
$
|
—
|
|
|
$
|
(202.6
|
)
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Additions to properties
|
(3.8
|
)
|
|
(48.9
|
)
|
|
(21.0
|
)
|
|
—
|
|
|
(73.7
|
)
|
|||||
Proceeds from sales of properties and other assets
|
—
|
|
|
1.5
|
|
|
1.5
|
|
|
—
|
|
|
3.0
|
|
|||||
Acquisition of businesses, net of cash acquired
|
—
|
|
|
(6.3
|
)
|
|
—
|
|
|
—
|
|
|
(6.3
|
)
|
|||||
Investment in MillerCoors
|
—
|
|
|
(417.9
|
)
|
|
—
|
|
|
—
|
|
|
(417.9
|
)
|
|||||
Return of capital from MillerCoors
|
—
|
|
|
310.4
|
|
|
—
|
|
|
—
|
|
|
310.4
|
|
|||||
Loan repayments
|
—
|
|
|
2.1
|
|
|
7.1
|
|
|
—
|
|
|
9.2
|
|
|||||
Loan advances
|
—
|
|
|
(3.1
|
)
|
|
(14.8
|
)
|
|
—
|
|
|
(17.9
|
)
|
|||||
Net intercompany investing activity
|
—
|
|
|
(90.2
|
)
|
|
(59.1
|
)
|
|
149.3
|
|
|
—
|
|
|||||
Net cash provided by (used in) investing activities
|
(3.8
|
)
|
|
(252.4
|
)
|
|
(86.3
|
)
|
|
149.3
|
|
|
(193.2
|
)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Exercise of stock options under equity compensation plans
|
24.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24.8
|
|
|||||
Excess tax benefits from share-based compensation
|
6.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.1
|
|
|||||
Dividends paid
|
(67.9
|
)
|
|
—
|
|
|
(8.3
|
)
|
|
—
|
|
|
(76.2
|
)
|
|||||
Payments on long-term debt and capital lease obligations
|
(0.1
|
)
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|||||
Proceeds from short-term borrowings
|
—
|
|
|
—
|
|
|
16.6
|
|
|
—
|
|
|
16.6
|
|
|||||
Payments on short-term borrowings
|
—
|
|
|
—
|
|
|
(7.1
|
)
|
|
—
|
|
|
(7.1
|
)
|
|||||
Net proceeds from (payments on) revolving credit facilities and commercial paper
|
127.8
|
|
|
—
|
|
|
30.0
|
|
|
—
|
|
|
157.8
|
|
|||||
Change in overdraft balances and other
|
—
|
|
|
—
|
|
|
1.6
|
|
|
—
|
|
|
1.6
|
|
|||||
Net intercompany financing activity
|
—
|
|
|
59.1
|
|
|
90.2
|
|
|
(149.3
|
)
|
|
—
|
|
|||||
Net cash provided by (used in) financing activities
|
90.7
|
|
|
58.9
|
|
|
123.0
|
|
|
(149.3
|
)
|
|
123.3
|
|
|||||
CASH AND CASH EQUIVALENTS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net increase (decrease) in cash and cash equivalents
|
9.2
|
|
|
(280.5
|
)
|
|
(1.2
|
)
|
|
—
|
|
|
(272.5
|
)
|
|||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
—
|
|
|
(21.4
|
)
|
|
(13.1
|
)
|
|
—
|
|
|
(34.5
|
)
|
|||||
Balance at beginning of year
|
40.9
|
|
|
470.7
|
|
|
113.0
|
|
|
—
|
|
|
624.6
|
|
|||||
Balance at end of period
|
$
|
50.1
|
|
|
$
|
168.8
|
|
|
$
|
98.7
|
|
|
$
|
—
|
|
|
$
|
317.6
|
|
|
Parent
Guarantor and
2012 Issuer
|
|
Subsidiary
Guarantors
|
|
Subsidiary
Non
Guarantors
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net cash provided by (used in) operating activities
|
$
|
8.0
|
|
|
$
|
98.1
|
|
|
$
|
43.6
|
|
|
$
|
—
|
|
|
$
|
149.7
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Additions to properties
|
(3.0
|
)
|
|
(42.5
|
)
|
|
(19.8
|
)
|
|
—
|
|
|
(65.3
|
)
|
|||||
Proceeds from sales of properties and other assets
|
—
|
|
|
1.4
|
|
|
0.3
|
|
|
—
|
|
|
1.7
|
|
|||||
Investment in MillerCoors
|
—
|
|
|
(354.9
|
)
|
|
—
|
|
|
—
|
|
|
(354.9
|
)
|
|||||
Return of capital from MillerCoors
|
—
|
|
|
259.5
|
|
|
—
|
|
|
—
|
|
|
259.5
|
|
|||||
Loan repayments
|
—
|
|
|
2.2
|
|
|
—
|
|
|
—
|
|
|
2.2
|
|
|||||
Loan advances
|
—
|
|
|
(1.6
|
)
|
|
(15.1
|
)
|
|
—
|
|
|
(16.7
|
)
|
|||||
Net intercompany investing activity
|
—
|
|
|
140.1
|
|
|
127.5
|
|
|
(267.6
|
)
|
|
—
|
|
|||||
Net cash provided by (used in) investing activities
|
(3.0
|
)
|
|
4.2
|
|
|
92.9
|
|
|
(267.6
|
)
|
|
(173.5
|
)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Exercise of stock options under equity compensation plans
|
20.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20.2
|
|
|||||
Excess tax benefits from share-based compensation
|
2.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.0
|
|
|||||
Dividends paid
|
(60.2
|
)
|
|
—
|
|
|
(8.0
|
)
|
|
—
|
|
|
(68.2
|
)
|
|||||
Payments on long-term debt and capital lease obligations
|
(0.4
|
)
|
|
(46.4
|
)
|
|
(0.1
|
)
|
|
—
|
|
|
(46.9
|
)
|
|||||
Proceeds from short-term borrowings
|
—
|
|
|
—
|
|
|
20.9
|
|
|
—
|
|
|
20.9
|
|
|||||
Payments on short-term borrowings
|
—
|
|
|
—
|
|
|
(12.5
|
)
|
|
—
|
|
|
(12.5
|
)
|
|||||
Payments on settlement of derivative instruments
|
—
|
|
|
(65.2
|
)
|
|
—
|
|
|
—
|
|
|
(65.2
|
)
|
|||||
Net proceeds from (payments on) revolving credit facilities and commercial paper
|
(28.6
|
)
|
|
—
|
|
|
(13.2
|
)
|
|
—
|
|
|
(41.8
|
)
|
|||||
Change in overdraft balances and other
|
—
|
|
|
—
|
|
|
111.3
|
|
|
—
|
|
|
111.3
|
|
|||||
Net intercompany financing activity
|
—
|
|
|
(127.5
|
)
|
|
(140.1
|
)
|
|
267.6
|
|
|
—
|
|
|||||
Net cash provided by (used in) financing activities
|
(67.0
|
)
|
|
(239.1
|
)
|
|
(41.7
|
)
|
|
267.6
|
|
|
(80.2
|
)
|
|||||
CASH AND CASH EQUIVALENTS:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net increase (decrease) in cash and cash equivalents
|
(62.0
|
)
|
|
(136.8
|
)
|
|
94.8
|
|
|
—
|
|
|
(104.0
|
)
|
|||||
Effect of foreign exchange rate changes on cash and cash equivalents
|
—
|
|
|
(3.6
|
)
|
|
2.9
|
|
|
—
|
|
|
(0.7
|
)
|
|||||
Balance at beginning of year
|
90.6
|
|
|
248.7
|
|
|
103.0
|
|
|
—
|
|
|
442.3
|
|
|||||
Balance at end of period
|
$
|
28.6
|
|
|
$
|
108.3
|
|
|
$
|
200.7
|
|
|
$
|
—
|
|
|
$
|
337.6
|
|
•
|
In our Canada segment, both income from continuing operations before income taxes and underlying pretax income were
$30.9 million
for the quarter, which decreased from the first quarter of 2014, by $57.4 million and $4.4 million, respectively. Both income from continuing operations before income taxes and underlying pretax income were significantly impacted by unfavorable foreign currency movements, as well as cycling the $1.4 million benefit of equity earnings and administrative cost recoveries recognized in the first quarter of 2014 from our Modelo Molson Imports, L.P. ("MMI") joint venture in Canada, which was terminated at the end of February 2014. The decrease in income from continuing operations before income taxes was also attributable to termination fee income of
$63.2 million
recognized in the first quarter of 2014, resulting from the termination of MMI. See Part I-Item 1. Financial Statements,
Note 4, "Investments"
to the unaudited condensed consolidated financial statements for further discussion.
|
•
|
In our U.S. segment, equity income in MillerCoors increased
5.3%
to
$129.3 million
and underlying equity income in MillerCoors increased
5.0%
to
$129.3 million
, both increases driven by higher pricing, positive sales mix and strong cost control, partially offset by lower volume.
|
•
|
Our Europe segment reported a loss from continuing operations before income taxes of
$4.1 million
in the first quarter of 2015, compared to income from continuing operations before income taxes of
$27.0 million
in the first quarter of 2014, and underlying pretax income of
$4.5 million
decreased
72.2%
. Both decreases reflect weak consumer demand in some of our higher revenue and profit markets, as well as an industry volume mix shift to the economy segment where we chose not to pursue value ahead of volume. As a result, our first quarter results reflect positive pricing in most of our Europe markets, but also lower volume and negative sales mix. Higher severance costs also contributed to lower earnings versus a particularly strong quarter in the prior year. Additionally, the loss from continuing operations before income taxes includes accelerated depreciation recognized in the first quarter of 2015 related to the decision to close one of our brewing facilities in the U.K.
|
•
|
In our MCI segment, both loss from continuing operations before income taxes and underlying pretax loss were
$5.4 million
for the quarter, an increase of $2.4 million from the first quarter of 2014, due to unfavorable foreign currency movements and increased marketing investments.
|
•
|
Volume for
Carling
, the number one beer brand in the U.K. and the largest brand in our Europe segment, declined during the first quarter of 2015, due to weak consumer demand in the U.K. beer market.
|
•
|
Coors Light
global volume (including our proportionate percentage of MillerCoors'
Coors Light
volumes) increased slightly during the first quarter of 2015 by 0.6% versus the first quarter of 2014. The overall volume increase in the first quarter was driven by increases in Europe and Latin America, partially offset by lower volumes in the U.S. and Canada. The declines in the U.S. and Canada were partly due to ongoing competitive pressures. We continue to implement plans to reverse the declines in
Coors Light
performance in Canada and the U.S., and have started to see improvements in the first quarter of 2015 in the U.S.
|
•
|
Molson Canadian
volume in Canada decreased during the first quarter of 2015 versus the prior year, primarily driven by cycling strong volumes in the prior year from the Winter Olympics.
|
•
|
Staropramen
volume decreased overall during the first quarter of 2015, versus the first quarter of 2014, primarily driven by competitive challenges and overall industry declines in Czech Republic,
Staropramen's
primary market. Above premium
Staropramen
(outside of Czech Republic) grew volume in the region and achieved strong growth in the international markets of Ukraine, Germany and the U.K.
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages and per share data)
|
|||||||||
Volume in hectoliters
|
5.632
|
|
|
5.913
|
|
|
(4.8
|
)%
|
||
Net sales
|
$
|
700.0
|
|
|
$
|
816.0
|
|
|
(14.2
|
)%
|
Net income attributable to MCBC from continuing operations
|
$
|
79.2
|
|
|
$
|
165.3
|
|
|
(52.1
|
)%
|
Adjustments:
|
|
|
|
|
|
|||||
Special items, net
(1)
|
8.6
|
|
|
(52.5
|
)
|
|
(116.4
|
)%
|
||
42% of MillerCoors specials items, net of tax
(2)
|
—
|
|
|
0.3
|
|
|
(100.0
|
)%
|
||
Unrealized mark-to-market (gains) and losses
(3)
|
(0.1
|
)
|
|
0.4
|
|
|
(125.0
|
)%
|
||
Other non-core items
(4)
|
—
|
|
|
(11.3
|
)
|
|
(100.0
|
)%
|
||
Tax effect on special and non-GAAP items
(5)
|
(1.6
|
)
|
|
—
|
|
|
N/M
|
|
||
Non-GAAP: Underlying income attributable to MCBC from continuing operations, net of tax
|
$
|
86.1
|
|
|
$
|
102.2
|
|
|
(15.8
|
)%
|
Net Income attributable to MCBC per diluted share from continuing operations
|
$
|
0.42
|
|
|
$
|
0.89
|
|
|
(52.8
|
)%
|
Non-GAAP: Underlying net income attributable to MCBC per diluted share from continuing operations
|
$
|
0.46
|
|
|
$
|
0.55
|
|
|
(16.4
|
)%
|
(1)
|
See Part I—Item 1. Financial Statements,
Note 6, "Special Items"
of the unaudited condensed consolidated financial statements for additional information. Special items for the
three
months ended
March 31, 2015
, and
March 31, 2014
, include accelerated depreciation expense of
$11.8 million
and accelerated amortization expense of
$4.9 million
, respectively, which are included in our adjustments to arrive at underlying EBITDA in the table below.
|
(2)
|
See "Results of Operations" - "United States Segment" - "Special Items, net" below for additional information. There were no tax effects related to our share of MillerCoors special items for the
three
months ended
March 31, 2014
.
|
(3)
|
The unrealized changes in fair value on our commodity swaps not designated in hedging relationships are recorded as cost of goods sold within our Corporate business activities. As the exposure we are managing is realized, we reclassify the gain or loss to the segment in which the underlying exposure resides, allowing our segments to realize the economic effects of the derivative without the resulting unrealized mark-to-market volatility. Related to these derivatives, we recorded unrealized net gains of
$0.1 million
and losses of
$0.9 million
during the
three
months ended
March 31, 2015
, and
March 31, 2014
, respectively.
|
(4)
|
In the first quarter of 2014, we recognized a gain of $11.3 million within marketing, general and administrative expenses related to the release of an indirect tax reserve recorded in conjunction with the initial purchase accounting for the acquisition (the "Acquisition") of StarBev Holdings S.à r.l. ("StarBev") from StarBev L.P. (the "Seller") on June 15, 2012, which is related to the settlement of certain local country regulatory matters associated with pre-acquisition periods.
|
(5)
|
The effect of taxes on the adjustments used to arrive at underlying income, a non-GAAP measure, is calculated based on applying the estimated underlying full-year effective tax rate to actual underlying earnings, excluding special and non-core items. The effect of taxes on special and non-core items is calculated based on the statutory tax rate applicable to the item being adjusted for in the jurisdiction from which each adjustment arises. Additionally, the
three
months ended March 31, 2014, include an income tax benefit of $16.2 million recognized in the first quarter of 2014 related to the release of an income tax reserve recorded in conjunction with the initial purchase accounting for the Acquisition and is related to the settlement of certain local country regulatory matters associated with pre-acquisition periods. This income tax benefit fully offset the income tax effect on the adjustments used to arrive at underlying income for the three months ended March 31, 2014.
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages and per share data)
|
|||||||||
Net income attributable to MCBC from continuing operations
|
$
|
79.2
|
|
|
$
|
165.3
|
|
|
(52.1
|
)%
|
Add: Net income (loss) attributable to noncontrolling interests
|
1.5
|
|
|
(0.5
|
)
|
|
N/M
|
|
||
Net income (loss) from continuing operations
|
$
|
80.7
|
|
|
$
|
164.8
|
|
|
(51.0
|
)%
|
Adjustments:
|
|
|
|
|
|
|||||
Add: Interest expense (income), net
|
29.2
|
|
|
35.4
|
|
|
(17.5
|
)%
|
||
Add: Income tax expense (benefit)
|
12.8
|
|
|
4.8
|
|
|
166.7
|
%
|
||
Add: Depreciation and amortization
|
77.5
|
|
|
81.2
|
|
|
(4.6
|
)%
|
||
Adjustments included in underlying income
(1)
|
8.5
|
|
|
(63.4
|
)
|
|
(113.4
|
)%
|
||
Adjustments to arrive at underlying EBITDA
(2)
|
(11.8
|
)
|
|
(4.9
|
)
|
|
140.8
|
%
|
||
Adjustments to arrive at underlying EBITDA related to our investment in MillerCoors
(3)
|
31.7
|
|
|
33.3
|
|
|
(4.8
|
)%
|
||
Non-GAAP: Underlying EBITDA
|
$
|
228.6
|
|
|
$
|
251.2
|
|
|
(9.0
|
)%
|
(1)
|
Includes adjustments to non-GAAP underlying income within the table above related to special and non-core items.
|
(2)
|
Represents adjustments to remove amounts related to interest, depreciation and amortization included in the adjustments to non-GAAP underlying income above, as these items are added back as adjustments to net income attributable to MCBC from continuing operations.
|
(3)
|
Adjustments to our equity income from MillerCoors, which include our proportionate share of MillerCoors' interest, income tax, depreciation and amortization, special items, and amortization of the difference between the MCBC contributed cost basis and proportionate share of the underlying equity in net assets of MillerCoors.
|
|
Three Months Ended
|
|||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||
|
(In millions, except percentages)
|
|||||||
Volume in hectoliters:
|
|
|
|
|
|
|||
Financial volume
|
5.632
|
|
|
5.913
|
|
|
(4.8
|
)%
|
Royalty volume
(1)
|
0.334
|
|
|
0.300
|
|
|
11.3
|
%
|
Owned volume
|
5.966
|
|
|
6.213
|
|
|
(4.0
|
)%
|
Proportionate share of equity investment STR
(2)
|
5.535
|
|
|
5.705
|
|
|
(3.0
|
)%
|
Total worldwide beer volume
|
11.501
|
|
|
11.918
|
|
|
(3.5
|
)%
|
(1)
|
Includes MCI segment royalty volume that is primarily in Russia, Ukraine and Mexico, and Europe segment royalty volume in Republic of Ireland.
|
(2)
|
Reflects the addition of our proportionate share of equity method investments STR for the periods presented.
|
|
|
Volume
|
|
Price, Product and Geography Mix
|
|
Currency
|
|
Other
|
|
Total
|
|||||
Consolidated
|
|
(4.8
|
)%
|
|
1.8
|
%
|
|
(11.2
|
)%
|
|
—
|
%
|
|
(14.2
|
)%
|
Canada
|
|
(2.1
|
)%
|
|
3.8
|
%
|
|
(11.3
|
)%
|
|
(0.1
|
)%
|
|
(9.7
|
)%
|
Europe
|
|
(7.0
|
)%
|
|
(0.1
|
)%
|
|
(11.2
|
)%
|
|
0.1
|
%
|
|
(18.2
|
)%
|
MCI
|
|
12.9
|
%
|
|
(13.2
|
)%
|
|
(9.3
|
)%
|
|
—
|
%
|
|
(9.6
|
)%
|
Corporate
(1)
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
33.3
|
%
|
|
33.3
|
%
|
|
Three Months Ended
|
||||
|
March 31, 2015
|
|
March 31, 2014
|
||
Effective tax rate
|
14
|
%
|
|
3
|
%
|
Adjustments:
|
|
|
|
||
Non-core tax benefits
|
—
|
%
|
|
7
|
%
|
Tax impact of special and other non-core items
|
—
|
%
|
|
(5
|
)%
|
Non-GAAP: Underlying effective tax rate
|
14
|
%
|
|
5
|
%
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages)
|
|||||||||
Volume in hectoliters
|
1.530
|
|
|
1.563
|
|
|
(2.1
|
)%
|
||
Sales
|
$
|
409.3
|
|
|
$
|
455.6
|
|
|
(10.2
|
)%
|
Excise taxes
|
(95.8
|
)
|
|
(108.5
|
)
|
|
(11.7
|
)%
|
||
Net sales
|
313.5
|
|
|
347.1
|
|
|
(9.7
|
)%
|
||
Cost of goods sold
|
(199.3
|
)
|
|
(216.7
|
)
|
|
(8.0
|
)%
|
||
Gross profit
|
114.2
|
|
|
130.4
|
|
|
(12.4
|
)%
|
||
Marketing, general and administrative expenses
|
(84.7
|
)
|
|
(96.0
|
)
|
|
(11.8
|
)%
|
||
Special items, net
(1)
|
—
|
|
|
53.0
|
|
|
(100.0
|
)%
|
||
Operating income (loss)
|
29.5
|
|
|
87.4
|
|
|
(66.2
|
)%
|
||
Other income (expense), net
|
1.4
|
|
|
0.9
|
|
|
55.6
|
%
|
||
Income (loss) from continuing operations before income taxes
|
$
|
30.9
|
|
|
$
|
88.3
|
|
|
(65.0
|
)%
|
Adjusting items:
|
|
|
|
|
|
|
||||
Special items, net
(1)
|
—
|
|
|
(53.0
|
)
|
|
(100.0
|
)%
|
||
Non-GAAP: Underlying pretax income (loss)
|
$
|
30.9
|
|
|
$
|
35.3
|
|
|
(12.5
|
)%
|
(1)
|
See Part I-Item 1. Financial Statements,
Note 6, "Special Items"
to the unaudited condensed consolidated financial statements for detail of special items.
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages)
|
|||||||||
Volumes in hectoliters
(1)
|
16.101
|
|
|
16.488
|
|
|
(2.3
|
)%
|
||
Sales
|
$
|
2,025.8
|
|
|
$
|
2,050.1
|
|
|
(1.2
|
)%
|
Excise taxes
|
(251.2
|
)
|
|
(259.7
|
)
|
|
(3.3
|
)%
|
||
Net sales
|
1,774.6
|
|
|
1,790.4
|
|
|
(0.9
|
)%
|
||
Cost of goods sold
|
(1,076.2
|
)
|
|
(1,094.1
|
)
|
|
(1.6
|
)%
|
||
Gross profit
|
698.4
|
|
|
696.3
|
|
|
0.3
|
%
|
||
Marketing, general and administrative expenses
|
(389.1
|
)
|
|
(398.1
|
)
|
|
(2.3
|
)%
|
||
Special items, net
|
—
|
|
|
(0.7
|
)
|
|
(100.0
|
)%
|
||
Operating income
|
309.3
|
|
|
297.5
|
|
|
4.0
|
%
|
||
Interest income (expense), net
|
(0.3
|
)
|
|
(0.3
|
)
|
|
—
|
%
|
||
Other income (expense), net
|
1.3
|
|
|
0.3
|
|
|
N/M
|
|
||
Income (loss) from continuing operations before income taxes
|
310.3
|
|
|
297.5
|
|
|
4.3
|
%
|
||
Income tax expense
|
(1.1
|
)
|
|
(1.9
|
)
|
|
(42.1
|
)%
|
||
Net income (loss) from continuing operations
|
309.2
|
|
|
295.6
|
|
|
4.6
|
%
|
||
Net (income) loss attributable to noncontrolling interests
|
(4.6
|
)
|
|
(4.4
|
)
|
|
4.5
|
%
|
||
Net income (loss) attributable to MillerCoors
|
$
|
304.6
|
|
|
$
|
291.2
|
|
|
4.6
|
%
|
Adjusting items:
|
|
|
|
|
|
|
||||
Special items, net of tax
|
—
|
|
|
0.7
|
|
|
(100.0
|
)%
|
||
Non-GAAP: Underlying net income attributable to MillerCoors
|
$
|
304.6
|
|
|
$
|
291.9
|
|
|
4.4
|
%
|
(1)
|
Includes contract brewing and company-owned distributor sales, which are excluded from our worldwide beer volume calculation.
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages)
|
|||||||||
Net income attributable to MillerCoors
|
$
|
304.6
|
|
|
$
|
291.2
|
|
|
4.6
|
%
|
MCBC economic interest
|
42
|
%
|
|
42
|
%
|
|
|
|
||
MCBC proportionate share of MillerCoors net income
|
$
|
127.9
|
|
|
$
|
122.3
|
|
|
4.6
|
%
|
Amortization of the difference between MCBC contributed cost basis and proportionate share of the underlying equity in net assets of MillerCoors
(1)
|
1.1
|
|
|
1.1
|
|
|
—
|
%
|
||
Share-based compensation adjustment
(1)
|
0.3
|
|
|
(0.6
|
)
|
|
(150.0
|
)%
|
||
Equity income in MillerCoors
|
$
|
129.3
|
|
|
$
|
122.8
|
|
|
5.3
|
%
|
Adjusting items:
|
|
|
|
|
|
|
||||
MCBC proportionate share of MillerCoors special items, net of tax
|
—
|
|
|
0.3
|
|
|
(100.0
|
)%
|
||
Non-GAAP: Underlying equity income in MillerCoors
|
$
|
129.3
|
|
|
$
|
123.1
|
|
|
5.0
|
%
|
(1)
|
See Part I—Item 1. Financial Statements,
Note 4, "Investments"
to the unaudited condensed consolidated financial statements for a detailed discussion of these equity method adjustments.
|
|
|
Volume
|
|
Domestic Price, Product and Geography Mix
|
|
Currency
|
|
Other
|
|
Total
|
|||||
MillerCoors
|
|
(2.3
|
)%
|
|
1.6
|
%
|
|
—
|
%
|
|
(0.2
|
)%
|
|
(0.9
|
)%
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages)
|
|||||||||
Volume in hectoliters
(1)
|
3.798
|
|
|
4.085
|
|
|
(7.0
|
)%
|
||
Sales
(1)
|
$
|
559.7
|
|
|
$
|
685.8
|
|
|
(18.4
|
)%
|
Excise taxes
|
(201.8
|
)
|
|
(248.2
|
)
|
|
(18.7
|
)%
|
||
Net sales
(1)
|
357.9
|
|
|
437.6
|
|
|
(18.2
|
)%
|
||
Cost of goods sold
|
(236.9
|
)
|
|
(286.0
|
)
|
|
(17.2
|
)%
|
||
Gross profit
|
121.0
|
|
|
151.6
|
|
|
(20.2
|
)%
|
||
Marketing, general and administrative expenses
|
(117.2
|
)
|
|
(126.2
|
)
|
|
(7.1
|
)%
|
||
Special items, net
(2)
|
(8.6
|
)
|
|
(0.5
|
)
|
|
N/M
|
|
||
Operating income (loss)
|
(4.8
|
)
|
|
24.9
|
|
|
(119.3
|
)%
|
||
Interest income
(3)
|
1.0
|
|
|
1.1
|
|
|
(9.1
|
)%
|
||
Other income (expense), net
|
(0.3
|
)
|
|
1.0
|
|
|
(130.0
|
)%
|
||
Income (loss) from continuing operations before income taxes
|
$
|
(4.1
|
)
|
|
$
|
27.0
|
|
|
(115.2
|
)%
|
Adjusting items:
|
|
|
|
|
|
|||||
Special items, net
(2)
|
8.6
|
|
|
0.5
|
|
|
N/M
|
|
||
Other non-core items
|
—
|
|
|
(11.3
|
)
|
|
(100.0
|
)%
|
||
Non-GAAP: Underlying pretax income (loss)
|
$
|
4.5
|
|
|
$
|
16.2
|
|
|
(72.2
|
)%
|
(1)
|
Gross segment sales include intercompany sales to MCI consisting of
$0.9 million
of net sales and
0.010 million
hectoliters for the
three
months ended
March 31, 2015
. Gross segment sales include intercompany sales to MCI consisting of
$1.2 million
of net sales and
0.013 million
hectoliters for the
three
months ended
March 31, 2014
. The offset is included within MCI cost of goods sold. These amounts are eliminated in the consolidated totals.
|
(2)
|
See Part I-Item 1. Financial Statements,
Note 6, "Special Items"
to the unaudited condensed consolidated financial statements for detail of special items.
|
(3)
|
Interest income is earned on trade loans to on-premise customers exclusively in the U.K. and is typically driven by note receivable balances outstanding from period to period.
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages)
|
|||||||||
Volume in hectoliters
(1)
|
0.314
|
|
|
0.278
|
|
|
12.9
|
%
|
||
Sales
|
$
|
34.7
|
|
|
$
|
37.8
|
|
|
(8.2
|
)%
|
Excise taxes
|
(5.6
|
)
|
|
(5.6
|
)
|
|
—
|
%
|
||
Net sales
|
29.1
|
|
|
32.2
|
|
|
(9.6
|
)%
|
||
Cost of goods sold
(2)
|
(19.2
|
)
|
|
(20.8
|
)
|
|
(7.7
|
)%
|
||
Gross profit
|
9.9
|
|
|
11.4
|
|
|
(13.2
|
)%
|
||
Marketing, general and administrative expenses
|
(14.6
|
)
|
|
(14.4
|
)
|
|
1.4
|
%
|
||
Special items, net
(3)
|
—
|
|
|
—
|
|
|
—
|
%
|
||
Operating income (loss)
|
(4.7
|
)
|
|
(3.0
|
)
|
|
56.7
|
%
|
||
Other income (expense), net
|
(0.7
|
)
|
|
—
|
|
|
N/M
|
|
||
Income (loss) from continuing operations before income taxes
|
$
|
(5.4
|
)
|
|
$
|
(3.0
|
)
|
|
80.0
|
%
|
Adjusting items
|
—
|
|
|
—
|
|
|
—
|
%
|
||
Non-GAAP: Underlying pretax income (loss)
|
$
|
(5.4
|
)
|
|
$
|
(3.0
|
)
|
|
80.0
|
%
|
(1)
|
Excludes royalty volume of
0.296 million
hectoliters and
0.263 million
hectoliters for the
three
months ended
March 31, 2015
, and
March 31, 2014
, respectively.
|
(2)
|
Reflects gross segment amounts and for the three months ended March 31, 2015, and March 31, 2014, includes intercompany cost of goods sold from Europe of
$0.9 million
and
$1.2 million
, respectively. The offset is included within Europe net sales. These amounts are eliminated in the consolidated totals.
|
(3)
|
See Part I-Item 1. Financial Statements,
Note 6, "Special Items"
to the unaudited condensed consolidated financial statements for detail of special items.
|
|
Three Months Ended
|
|||||||||
|
March 31, 2015
|
|
March 31, 2014
|
|
% change
|
|||||
|
(In millions, except percentages)
|
|||||||||
Volume in hectoliters
|
—
|
|
|
—
|
|
|
—
|
%
|
||
Sales
|
$
|
0.4
|
|
|
$
|
0.3
|
|
|
33.3
|
%
|
Excise taxes
|
—
|
|
|
—
|
|
|
—
|
%
|
||
Net sales
|
0.4
|
|
|
0.3
|
|
|
33.3
|
%
|
||
Cost of goods sold
|
(0.3
|
)
|
|
(0.9
|
)
|
|
(66.7
|
)%
|
||
Gross profit
|
0.1
|
|
|
(0.6
|
)
|
|
(116.7
|
)%
|
||
Marketing, general and administrative expenses
|
(24.1
|
)
|
|
(27.3
|
)
|
|
(11.7
|
)%
|
||
Special items, net
(1)
|
—
|
|
|
—
|
|
|
—
|
%
|
||
Operating income (loss)
|
(24.0
|
)
|
|
(27.9
|
)
|
|
(14.0
|
)%
|
||
Interest expense, net
|
(30.2
|
)
|
|
(36.5
|
)
|
|
(17.3
|
)%
|
||
Other income (expense), net
|
(3.0
|
)
|
|
(1.1
|
)
|
|
172.7
|
%
|
||
Income (loss) from continuing operations before income taxes
|
$
|
(57.2
|
)
|
|
$
|
(65.5
|
)
|
|
(12.7
|
)%
|
Adjusting items:
|
|
|
|
|
|
|
|
|
||
Unrealized mark-to-market (gains) and losses
|
(0.1
|
)
|
|
0.4
|
|
|
(125.0
|
)%
|
||
Non-GAAP: Underlying pretax income (loss)
|
$
|
(57.3
|
)
|
|
$
|
(65.1
|
)
|
|
(12.0
|
)%
|
(1)
|
See Part I-Item 1. Financial Statements,
Note 6, "Special Items"
to the unaudited condensed consolidated financial statements for detail of special items.
|
|
As of
|
||||||||||
|
March 31, 2015
|
|
December 31, 2014
|
|
March 31, 2014
|
||||||
|
(In millions)
|
||||||||||
Current assets
|
$
|
1,278.1
|
|
|
$
|
1,578.9
|
|
|
$
|
1,484.3
|
|
Less: Current liabilities
|
(2,254.1
|
)
|
|
(2,325.3
|
)
|
|
(2,071.8
|
)
|
|||
Add: Current portion of long-term debt and short-term borrowings
|
941.2
|
|
|
849.4
|
|
|
630.4
|
|
|||
Net working capital (deficit)
|
$
|
(34.8
|
)
|
|
$
|
103.0
|
|
|
$
|
42.9
|
|
•
|
Net proceeds from our revolving credit facilities and commercial paper were
$157.8 million
during the
three
months ended
March 31, 2015
, versus net repayments of
$41.8 million
during the
three
months ended
March 31, 2014
. Additionally, during the
three
months ended
March 31, 2014
, we paid
$46.3 million
(
€34.0 million
) related to amounts previously withheld on the
€500 million
convertible note to the Seller and settled the remaining cross currency swap for
$65.2 million
, which were extended and designated as a net investment hedge in the fourth quarter of 2011.
|
•
|
The increase in cash is partially offset by a decrease in cash provided by our net overdraft borrowings on our European cross-border, cross-currency cash pool within our Europe business.
|
|
|
Three Months Ended
|
||||||
|
|
March 31, 2015
|
|
March 31, 2014
|
||||
|
|
(In millions)
|
||||||
U.S. GAAP:
|
Net Cash Provided by (Used In) Operating Activities
|
$
|
(202.6
|
)
|
|
$
|
149.7
|
|
Less:
|
Additions to properties
(1)
|
(73.7
|
)
|
|
(65.3
|
)
|
||
Less:
|
Investment in MillerCoors
(1)
|
(417.9
|
)
|
|
(354.9
|
)
|
||
Add:
|
Return of capital from MillerCoors
(1)
|
310.4
|
|
|
259.5
|
|
||
Add/(Less):
|
Cash impact of special items
(2)
|
(5.5
|
)
|
|
(57.1
|
)
|
||
Add:
|
Discretionary pension contribution
(3)
|
227.1
|
|
|
—
|
|
||
Add:
|
MillerCoors investments in businesses
(4)
|
—
|
|
|
1.3
|
|
||
Add:
|
MillerCoors cash impact of special items
(4)
|
—
|
|
|
2.2
|
|
||
Non-GAAP:
|
Underlying Free Cash Flow
|
$
|
(162.2
|
)
|
|
$
|
(64.6
|
)
|
(1)
|
Included in net cash used in investing activities.
|
(2)
|
Included in net cash provided by (used in) operating activities and primarily reflects termination fees received in addition to costs paid for restructuring activities.
|
(3)
|
Discretionary cash contribution of
$227.1 million
made to our U.K. pension plan included in net cash used in operating activities.
|
(4)
|
Amounts represent our proportionate 42% share of the cash flow impacts.
|
|
Three Months Ended
|
||||
|
March 31, 2015
|
|
March 31, 2014
|
||
Weighted-Average Exchange Rate (1 USD equals)
|
|
|
|
||
Canadian Dollar (CAD)
|
1.24
|
|
|
1.11
|
|
Euro (EUR)
|
0.89
|
|
|
0.73
|
|
British Pound (GBP)
|
0.66
|
|
|
0.60
|
|
Czech Koruna (CZK)
|
24.60
|
|
|
19.99
|
|
Croatian Kuna (HRK)
|
6.88
|
|
|
5.57
|
|
Serbian Dinar (RSD)
|
109.08
|
|
|
84.12
|
|
New Romanian Leu (RON)
|
3.92
|
|
|
3.27
|
|
Bulgarian Lev (BGN)
|
1.72
|
|
|
1.43
|
|
Hungarian Forint (HUF)
|
273.14
|
|
|
222.95
|
|
|
As of
|
||||
|
March 31, 2015
|
|
December 31, 2014
|
||
Closing Exchange Rate (1 USD equals)
|
|
|
|
||
Canadian Dollar (CAD)
|
1.27
|
|
|
1.16
|
|
Euro (EUR)
|
0.93
|
|
|
0.83
|
|
British Pound (GBP)
|
0.67
|
|
|
0.64
|
|
Czech Koruna (CZK)
|
25.68
|
|
|
22.86
|
|
Croatian Kuna (HRK)
|
7.12
|
|
|
6.33
|
|
Serbian Dinar (RSD)
|
111.98
|
|
|
100.30
|
|
New Romanian Leu (RON)
|
4.11
|
|
|
3.70
|
|
Bulgarian Lev (BGN)
|
1.82
|
|
|
1.62
|
|
Hungarian Forint (HUF)
|
279.98
|
|
|
261.64
|
|
|
Payments due by period
|
||||||||||||||||||
|
Total
|
|
Less than 1 year
|
|
1 - 3 years
|
|
3 - 5 years
|
|
More than 5 years
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Debt obligations
|
$
|
3,235.4
|
|
|
$
|
941.3
|
|
|
$
|
694.1
|
|
|
$
|
—
|
|
|
$
|
1,600.0
|
|
Interest payments on debt obligations
|
1,682.0
|
|
|
111.0
|
|
|
175.1
|
|
|
145.0
|
|
|
1,250.9
|
|
|||||
Retirement plan expenditures
(1)
|
102.4
|
|
|
32.6
|
|
|
14.8
|
|
|
15.5
|
|
|
39.5
|
|
|||||
Operating leases
|
114.4
|
|
|
28.3
|
|
|
33.8
|
|
|
21.5
|
|
|
30.8
|
|
|||||
Other long-term obligations
(2)
|
2,180.9
|
|
|
686.2
|
|
|
622.4
|
|
|
330.6
|
|
|
541.7
|
|
|||||
Total obligations
|
$
|
7,315.1
|
|
|
$
|
1,799.4
|
|
|
$
|
1,540.2
|
|
|
$
|
512.6
|
|
|
$
|
3,462.9
|
|
(1)
|
We fund pension plans to meet the requirements set forth in applicable employee benefits laws. We may also voluntarily increase funding levels to meet financial goals. Our U.K. pension plan is subject to a statutory valuation for funding purposes every three years. The most recent valuation as of June 30, 2013, was completed during the first
|
(2)
|
The "other long-term obligations" line primarily includes non-cancellable purchase commitments as of
March 31, 2015
, that are enforceable and legally binding. The majority of the balance relates to commitments associated with our distribution agreements, long-term supply contracts with third parties to purchase raw materials, derivative payments, packaging materials and energy used in production, and advertising and promotions, including sports sponsorships.
|
|
Amount of commitment expiration per period
|
||||||||||||||||||
|
Total amounts
committed
|
|
Less than 1 year
|
|
1 - 3 years
|
|
3 - 5 years
|
|
More than 5 years
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Standby letters of credit
|
$
|
53.8
|
|
|
$
|
51.4
|
|
|
$
|
2.4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total
|
|
Less than 1 year
|
|
1 - 3 years
|
|
3 - 5 years
|
|
More than 5 years
|
||||||||||
(In millions)
|
||||||||||||||||||
$
|
50.3
|
|
|
$
|
(0.3
|
)
|
|
$
|
31.5
|
|
|
$
|
(0.1
|
)
|
|
$
|
19.2
|
|
|
As of
|
||||||
|
March 31, 2015
|
|
December 31, 2014
|
||||
|
(In millions)
|
||||||
Estimated fair value volatility
|
|
|
|
||||
Foreign currency risk:
|
|
|
|
||||
Forwards
|
$
|
(35.3
|
)
|
|
$
|
(35.8
|
)
|
Swaps
|
$
|
(10.4
|
)
|
|
$
|
(5.7
|
)
|
Foreign currency denominated debt
|
$
|
(114.5
|
)
|
|
$
|
(125.6
|
)
|
Interest rate risk:
|
|
|
|
||||
Debt
|
$
|
(113.3
|
)
|
|
$
|
(111.9
|
)
|
Swaps
|
$
|
(17.3
|
)
|
|
(2.4
|
)
|
|
Commodity price risk:
|
|
|
|
||||
Swaps
|
$
|
(18.6
|
)
|
|
$
|
(20.4
|
)
|
Exhibit
Number
|
|
Document Description
|
|
10.1
|
|
Employment letter between Molson Coors Brewing Company and Krishnan Anand, dated as of November 2, 2009.
|
|
31.1
|
|
Section 302 Certification of Chief Executive Officer.
|
|
31.2
|
|
Section 302 Certification of Chief Financial Officer.
|
|
32
|
|
Written Statement of Chief Executive Officer and Chief Financial Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 USC. Section 1350).
|
|
101.INS
|
|
XBRL Instance Document.*
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.*
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.*
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.*
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.*
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.*
|
|
|
|
|
|
*
|
|
Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) the Unaudited Condensed Consolidated Statements of Operations for the three months ended March 31, 2015, and March 31, 2014, (ii) the Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) for the three months ended March 31, 2015, and March 31, 2014, (iii) the Unaudited Condensed Consolidated Balance Sheets as of March 31, 2015, and December 31, 2014, (iv) the Unaudited Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2015, and March 31, 2014, (v) the Notes to Unaudited Condensed Consolidated Financial Statements, and (vi) document and entity information.
|
|
|
|
|
|
MOLSON COORS BREWING COMPANY
|
||
|
By:
|
|
/s/ BRIAN TABOLT
|
|
|
|
Brian Tabolt
Global Controller
(Chief Accounting Officer)
May 7, 2015
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Molson Coors Brewing Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
/s/ MARK HUNTER
|
|
|
Mark Hunter
President and Chief Executive Officer
(Principal Executive Officer)
|
|
|
May 7, 2015
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Molson Coors Brewing Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
|
/s/ GAVIN HATTERSLEY
|
|
|
Gavin Hattersley
Chief Financial Officer
(Principal Financial Officer)
|
|
|
May 7, 2015
|
(a)
|
the Quarterly Report on Form 10-Q of the Company for the quarterly period ended
March 31, 2015
filed on the date hereof with the Securities and Exchange Commission (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(b)
|
Information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
/s/ MARK HUNTER
|
|
|
Mark Hunter
President and Chief Executive Officer
(Principal Executive Officer)
|
|
|
May 7, 2015
|
|
|
|
|
|
/s/ GAVIN HATTERSLEY
|
|
|
Gavin Hattersley
Chief Financial Officer
(Principal Financial Officer)
|
|
|
May 7, 2015
|