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  • Beer Investors Scream "Hurray Beer!"

    Denver, Colo.- Molson Coors Brewing company (TAP) reported 2nd quarter 2009 earnings of $1.11 per share on August 3, 2009, which beat the $0.97 consensus of the analysts covering the company. It goes to show you when things in the economy start getting better the first thing we buy is cheap American Beer. Molson Coors reported that net income increased 136.3% from a year ago.

     

    Molson Coors is a holding company. The company’s operating subsidiaries include Molson Canada, Miller Coors Brewing Company and a 50% joint venture with Modelo Molson Imports.

     

    This quarters earning performance was driven by increased beer pricing and substantial cost reduction across the company. Can we say job cuts? Yes, for the quarter, marketing, general and administrative cost decreased by 10.8%. Although workers at Coors may have been laid off at least their severance pay includes a weekly 18 pack.

     

    Not all is sunny for the happy beer makers though. Like most other companies that export out of the United States there will continue to be unfavorable currency movements and cost inflation. It also seems like the worldwide demand for Coors is falling, perhaps because the cold activated cans scare the international consumer.

     

    Almost every English beer is known to be far better than a Coors light. Brits still made room in their beer bellies for a good old American Coors. The U.K. business reported underlying pretax income of $36.8 million in the second quarter, an increase of $15.3 million, or 70.1% versus the same quarter form last year.  

    Peter Swimburn, President & CEO said “Our company is off to a solid start in the first half of this year, reflecting the benefit of our strong brands strategic initiative and cost reduction programs.”

     

    Molson Coors stock was up 5% the day they released their earnings perhaps because investors saw that the company’s strengths can be seen in multiple areas. (TAP) has shown an increase in net income, good cash flow from operations, expanding profit margins, growth in earnings per share and largely solid financial positions with reasonable debt levels by most measures. Although the fundamentals may seem positive, they don’t always reflect the stock’s actions, which has recently been sub-par.

    Tags: TAP, coors, beer
    Aug 11 2:37 AM | Link | Comment!
  • MGM Grand May be Forced to Sell Lion
    Las Vegas, Nev.- Excluding a cash impairment charge of $0.34 per share from an investment in a convertible note, shares of MGM Grand (MGM) lost $0.12 per share. That missed the $0.09 loss expectation the analysts following the company had predicted.
                                                                                                                              
    MGM Mirage is engaged in gaming and resort operations. The company owns and operates casino resorts in Las Vegas which include Bellagio, MGM Grand, Mandalay Bay, The Mirage, Luxor, Excalibur, Treasure Island and Circus Circus, to name a few. I personally enjoy the Bellagio and Mandalay Bay but Excalibur needs to get imploded, especially if Louie Anderson is your headlining act.
     
    Net revenue decreased 17% to $1.5 billion. Compared to the last quarter, casino revenue decreased 12% mainly as a result of lower table game volumes. On the plus side, baccarat volume went up 17% showing once and for all that old people are the only people who can still afford to gamble in Vegas. Other interesting reports include a 29% decrease in room revenue as well as a 29% drop in average room rates. Food and Beverage revenue dropped 13%, while corporate expenses rose $43 million, $13 million of which were from legal and advisory cost. No surprise that if anyone can steal from Vegas it going to be a lawyer.
    Internationally, MGM is in talks with investors to develop a casino in Taiwan and potential projects in Japan and the Philippines.
     
    “This has been a monumental quarter for us, as the significant capital market transactions and other corporate finance activities meaningfully improved our financial positions,” said Jim Murren, MGM Mirage Chairman and CEO. I guess if I lived in Vegas and someone gave me millions in credit, I would feel like I had a monumental quarter too. Never mind the unprecedented debt just put it on my tab!
     
    MGM has clearly suffered from lower revenue, reduced net income, negative returns, lower visitor spending and reduced occupancy. I say take advantage of them and book as many weekend trip to Vegas as you can, while the rates are cheap!!
    Aug 11 2:27 AM | Link | Comment!
  • Constellation Brands (STZ), UniFirst (UNF) and General Mills (GIS) report Wed.

    Constellation Brands (STZ) is the largest wine producing company by volume in the world. Their beer portfolio includes international brands that include Corona Extra, Modelo and Tsingtao. Constellation is expected to report 2010 first-quarter earnings of 33 cents a share, according to analysts surveyed by FactSet Research.

    UniFirst (UNF) is a provider of workplace uniforms and protective work wear clothing in the United States. UniFirst’s strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, attractive valuation levels, expanding profit margins and notable return on equity. One downside is the weak operating cash flow, but an improvement in earnings per share growth may overweigh that.

    General Mills (GIS) is a manufacturer and marketer of branded consumer foods sold through retail stores. General Mills is forecast to post earnings of 81 cents a share in the fiscal fourth quarter. Although sales are predicted to stay stagnant in the current economy, 39.20% is the gross profit margin for General Mills Inc which according to thestreet.com is considered strong.   

    Jun 30 10:04 PM | Link | Comment!
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