With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Industries included in the sector are beverages, food consumer products, and food production.

Fortune Sector Leaders: Food, Beverages, and Tobacco

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

This year’s Fortune 500 marks the 68th running of the list.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-314-Molson Coors Beverage

Formed in 2005 through the merger of Molson of Canada, and the U.S.-based Coors, the drink and brewing company is one of the largest in the world, selling familiar brands such as Blue Moon, Miller Light, and Topo Chico Hard Seltzer.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-298-Molson-Coors-Beverage

The Chicago brewing company is among the world's largest and is behind beer brands such as Blue Moon, Miller High Life, and Leinenkugel's—not to mention Molson and Coors—as well as the cider brand Crispin.

This year's Fortune 500 marks the 65th running of the list.

Everybody loves an up-and-comer: 2019's top three-year performers in revenues, profits, and stock returns.

100 Fastest-Growing Companies

This year's Fortune 500 marks the 64th running of the list.

Everybody loves an up-and-comer: 2018's top three-year performers in revenues, profits, and stock returns.

This year's Fortune 500 marks the 63rd running of the list.

This year's Fortune 500 marks the 62nd running of the list.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Molson Coors Beverage Company manufactures, markets, and sells beer and other malt beverage products across the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company’s portfolio includes a range of flavored malt beverages, hard seltzers, craft beers, spirits, and ready-to-drink beverages. Its products are offered under a variety of brands, including Blue Moon, Coors Light, Miller Lite, Carling, and Staropramen, as well as premium and economy brands. Molson Coors serves a diverse customer base through multiple channels and continues to expand its offerings to meet evolving consumer preferences.

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Molson Coors Beverage (TAP): Company Profile, Stock Price, News, Rankings

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Molson Coors Beverage

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Good morning, and welcome to the Molson Coors Beverage Company Fourth Quarter twenty twenty four Fiscal Year Earnings Conference Call. With that, I'll hand it over to Greg Tierney, Vice President, FP and A and Commercial Finance.

Thank you, operator, and hello, everyone. Following prepared remarks today, we look forward to taking your questions. In an effort to address as many questions as possible, we ask that you limit yourself to one question. If you have technical questions on the quarter, please reach out to our IR team. Also, I encourage you to review our earnings release and earnings slides, which are posted to the IR section of our website and provide detailed financial and operational metrics.

Today's discussion includes forward looking statements. Actual results or trends could differ materially from our forecasts. For more information, please refer to the risk factors discussed in our most recent filings with the SEC. We assume no obligation to update forward looking statements except as required by applicable law. The definitions of or reconciliations for any non U.

S. GAAP measures are included in our earnings release. Unless otherwise indicated, all financial results we discuss are versus the comparable prior year period and are in U. S. Dollars.

With the exception of earnings per share, all financial metrics are in constant currency when referencing percentage changes from the prior year period. Also, share data references are sourced from Circana in The U. S. And from Beer Canada in Canada, unless otherwise indicated. Further, in our remarks today, we will reference underlying pretax income, which equates to underlying income before income taxes and underlying earnings per share, which equates to underlying diluted earnings per share as defined in our earnings release.

Thank you, Greg. Hello, everybody, and thank you for joining the call. 2024 was another year of progress for MolsonCrews, progress in advancing our strategy and in achieving bottom line growth. Amid a challenging macroeconomic environment, we continue to support the health of our brands globally. We retained a substantial portion of our sizable share gains from 2023 and earned unprecedented levels of shelf space for our core power brands in The U.

S. We achieved incredible growth in Canada, broadly across all price segments of our portfolio. We continue to premiumize off a high base in our EMEA and APAC business. We terminated low margin contract brewing agreement and exited smaller unprofitable businesses, while investing in areas that we expect will drive long term sustainable profitable growth. 2024 was also another year of continued strong cash generation that contributed to earnings power.

We delivered more than $1,200,000,000 in underlying free cash flow, which combined with our healthy balance sheet enabled us to not only invest in our business, but also to return $1,000,000,000 in cash to shareholders through a growing dividend and share repurchases. We enter this year confident, issuing 2025 guidance that both reflects the favorable fundamentals of our business and that aligns with our long term growth algorithm. Now with that high level summary, let's get into some of the details. In the fourth quarter, consolidated net sales revenue was down 1.9%, underlying pretax income was down 0.9% and underlying earnings per share was up 9.2%. In our Americas business, Canada continued to perform strongly, while as expected The U.

S. Faced a temporary headwind related to the exit of PAP's contract which was a headwind of about 450,000 hectoliters. U. S. Brand volume was down three percent in the quarter, which improved as compared to the third quarter as did the industry with a moderating of the more pronounced value seeking behavior seen during the summer.

These drivers contributed to a 6.7% decline in U. S. Financial volume. Related to the deliberate inventory build in the first half of the year, U. S.

Shipments trailed brand volumes by approximately 150,000 hectoliters in the quarter, resulting in largely shipping to consumption for the full year as intended. In the Marriott Bank, our volumes were impacted by the continued heightened competitive landscape in The UK as well as a softer industry in Central And Eastern Europe. However, this was largely offset by strong net sales revenue per hectoliter growth of 7.8% driven by favorable sales mix, including continued premiumization and pricing. This along with favorable net pricing growth in The Americas and mixed benefits from the exit of PAPS resulted in consolidated net sales revenue per hectoliter growth of 4.8% for the quarter. For the year, consolidated net sales revenue was down 0.6%, underlying pretax income was up 5.6% and underlying earnings per share was up 9.8%.

Results were better than our revised top line guidance of down approximately 1% due to better than expected U. S. Industry performance in the fourth quarter. As a reminder, our 2024 top line guidance was revised lower when we reported our third quarter results in early November due to macro driven U. S.

Industry softness in the peak season months of July and August. It's also important to point out that excluding the impact of the wind down of Pep's contract brewing volume, our implied annual top line revenue growth was positive and in alignment with our long term growth algorithm. From a volume perspective, PEPs had a negative three percentage point impact on Americas financial volume for the year. Again, while this is a current volume headwind, the reduction of this contract brewing volume is expected to have a positive impact in 2025 and beyond on our brewery network effectiveness as well as on mix and margin. And then what we expect will provide further benefits, we no longer contract brew for the BAT USA and Canada with that volume fully exiting our Canadian business as of year end twenty twenty four.

Tracy will share more on the impact of that. Consolidated underlying pretax income was above the midpoint of our reaffirmed mid single digit growth guidance. This was achieved due to the better than expected top line as well as measured cost controls without sacrificing the right levels of brand marketing support. In addition to better net sales revenue performance, we significantly exceeded our reaffirmed mid single digit underlying earnings per share growth guidance, which we had narrowed to the high end of the range in early November. The beat was largely supported by lower than expected underlying effective tax rate due to U.

S. Geographic sales mix as well as the better than expected top line performance in the fourth quarter. Underlying earnings per share growth was also supported by our share repurchases, which have been tracking at an accelerated pace as we continue to view our valuation as compelling given our confidence in our business and in our long term growth algorithm. In fact, for the first five quarters since the share repurchase program was announced, we had already executed approximately 40% under this up to five year program, which if you straight down that number would have us at only 25%. Our confidence stems from our progress against our strategic priorities.

I'll start with our core power brands. Collectively, they remain healthy. In The U. S, Coors Light, Miller Lite and Coors Banquet have continued to retain a substantial portion of our share gains, demonstrating the stickiness of these step change gains. In the fourth quarter, they retained over 80% of their combined volume share gains on a two year stack, which is an improvement from both the second and third quarters.

When compared to the fourth quarter of twenty twenty two, these brands were up 1.7 share points. Coors Bancorp continued to perform very well with brand volume up 16% and growing industry share for the fourteenth consecutive quarter on top of significant prior year gains. Bancorp was the fastest growing top 15 beer brand in The U. S. In terms of volume percentage growth in 2024.

That is not a small brand. In fact, it's one of our top five brands globally. And we see much more opportunity ahead as we invest in building the brand's awareness, its national scale and loyal consumer base, particularly among new Gen Z and millennial legal drinking age consumers. In Canada, Coors Light remains the number one light beer in the industry and again grew share of segments in the fourth quarter. The Molson family of brands also gained volume share for both the fourth quarter and the year.

This performance has helped us to drive twenty three consecutive months of share growth despite the challenging industry backdrop. In Ameri and APAC, a number of our core power brands are leaders in their respective markets. Carling remains a top lager in The UK with strong brand equity. Amid the highly competitive environment, we took a value over volume approach, which weighed on volume performance during the year. And while core brand performance was impacted by the soft industry in the fourth quarter in Central And Eastern Europe, our results were strong for the year.

This was driven by Juska in Croatia, which increased volume 5% as well as the extremely successful re launch of Caliman in Romania. Caliman has already reached over 300,000 hectares since March and has been incremental to the overall portfolio in the country. Turning to our premiumization priority for both beer and beyond beer, our above premium portfolio was 27% of total net brand revenue for the year. In EMEA and APAC, where over half of our net brand revenue comes from above premium, our business continued to premiumize. Much of EMEA and APAC's premiumization success has been driven by Madrid, which grew net sales revenue double digits in the year and is the number two livery in the on premise in The UK in terms of value.

Madrid is also exceeding expectations in Bulgaria following a very successful launch there last year. In The Americas, our above premium share of mid brand revenue was 22% for the year. This was supported by Canada, which also continued to premiumize with its above premium mid brand revenue up at double digits in 2024. This was driven by the success of Miller Lite, which is the fastest growing major beer brand in this market on a percentage basis as well as by our flavor portfolio. We are growing more share of flavor than any other major brewer in Canada and Madrid is also performing ahead of expectations in Canada following last year's launch.

In The U. S, there is work to do, but we see this as an opportunity and we have big plans in 2025. After further fine tuning our portfolio last year, including divesting underperforming craft breweries, our resources are focused on scalable opportunities within our expanding above premium portfolio brands in both beer and beyond beer. In beer, we are moving in the right direction with the Blue Moon brand family as we are starting to see signs of stability. In fact, the Blue Moon brand family held share of industry in both the third and fourth quarters and took share of craft during both periods.

This includes positive momentum behind some of our newer innovations like the repositioned Blue Moon lite as well as Blue Moon non ALK, which has quickly become a top 10 non ALK beer brand. And we have plans to build on these results for the Bloomin brand family in 2025. And we are betting big on Peroni. As we have discussed, we have onshore production, which offers a number of benefits. It significantly improves consistency and certainty of supply which has previously been a challenge when we try to scale the brand.

It allows us to introduce different pack sizes which consumers are asking for and it also unlocks meaningful cost savings which we intend to deploy toward increasing distribution and awareness to drive scale and margin for this brand. Our commercial plans kick off in the second quarter. And while it will of course take time, ultimately, we see no reason why Pironi can't rival the size of other major European imports in The U. S. Over time.

In Beyond Bear, which is a big part of our premiumization plans, non ALK is a key focus area. It provides us the opportunity to capture more occasions, particularly among younger legal age Gen Z consumers. So we are investing behind the growing areas in non ALK where we believe we have a right to win. This too will take some time, but we are making progress. We spoke in detail on our last quarter call about our increased investment in ZOWA to a majority stake and plans to accelerate the brand are well underway.

It's early days of the integration, but in the last four weeks to end the year, Zoa grew in both dollar and unit share in total U. S. Food. Taking this increased stake allows us to lead the entirety of the brand's marketing, retail and direct to consumer sales development as we drive brand awareness and distribution, leveraging the strength of our network. And speaking of opportunities to advance our plans, we are so pleased to have entered into a strategic partnership agreement with the world's leading supplier of premium carbonated mixes.

The partnership agreement gives us the exclusive commercialization rights to the Fever Tree brand in The U. S. This is a significant step forward in our strategic ambition to build a total beverage portfolio for a wide range consumer preferences across both traditional alcohol and non alcohol occasions. Now before I pass it to Tracy, I'll conclude by saying that we remain confident we have the right strategy to achieve our long term growth objectives. And our 2025 guidance is aligned with those objectives.

Collectively, our global core power brands are healthy and we have great commercial plans in 2025 to continue to support them. We are changing the shape of our global portfolio with premiumization successes in May of APAC and Canada and we have targeted plans for The U. S. Our operations outside of The U. S.

Are performing well and contributing meaningfully to our growth. Our capabilities across our organization support premiumization and focused innovation, supply chain efficiencies and commercial effectiveness, which help drive sustained long term profitable growth. And with our compelling cash generation and a healthy balance sheet, we have substantially improved our financial flexibility, allowing us to continue to invest in our business and return cash to shareholders. So we are pleased with our progress and confident in our ability to achieve our long term growth algorithm in 2025 and beyond. With that, I will pass it to Tracy.

Thank you, Gavin. We made strong progress in enhancing our profitability and financial flexibility in 2024. We delivered over $1,200,000,000 in underlying free cash flow in line with our expectations. And it was supported by underlying pre tax income margin expansion of nearly 80 basis points for the year. This expansion was driven by positive net pricing, mix impact, moderating inflation and cost savings, which more than offset volume deleverage, which had a particularly significant impact in the second half of the year related to U.

S. Shipment timing. Also contributing to the margin improvement was lower MG and A, largely due to cycling innovative levels in 2023. G and A declines were mostly related to higher incentive compensation in 2023. Marketing declines were mainly a result of higher investments in the prior year, particularly in the second half of the year when we increased spend by an incremental $100,000,000 given the accelerated demand in The U.

S. But importantly, we continue to support our brands globally with higher levels of marketing investments for both the quarter and the year as compared to the respective periods in 2022. In addition to investing in our brands and business, we continue to return cash to shareholders. In 2024, we paid $369,000,000 in cash dividends and $643,000,000 to repurchase 10,900,000.0 shares. Since the plan was announced in October 2023, we have repurchased 6.7% of our Class B shares outstanding.

It's an up to five year two billion dollars plan And as Gavin mentioned, we have utilized approximately 40% in just the first five quarters. We ended the year with a healthy balance sheet and our net debt to underlying EBITDA ratio was 2.1 times, which is in alignment with our long term target of under 2.5 times. And we have no debt coming due in 2025. This provides us significant financial flexibility, offering more optionality in the ways that we invest in the business, be it through capital investments that drive productivity improvements or through bolt on M and A that support our strategic growth objectives, like our recent investment in Fevertree. It also provides us the opportunity to return even more cash to shareholders.

And we are pleased to share that today, we announced our quarterly dividend of $0.47 per share to be paid on March. This is an increase of 6.8% and represents our fourth consecutive year of increases, clearly demonstrating our intention to sustainably increase our dividend. And now I'll conclude with our financial outlook. For 2025, we are issuing guidance that is in line with our long term growth algorithm. However, the global macro environment is rapidly evolving, resulting in uncertainty around the effects of geopolitical events and global trade policy, including the impact from consumer trends.

As a result, our outlook does not reflect the impact of these activities or any imposition of import tariffs by The U. S. And potential retaliatory actions by other countries. Also, please remember that net sales revenue and underlying pre tax income growth guidance are on a constant currency basis and underlying earnings per share are not. Therefore, continued strength in the U.

S. Dollar will result in a headwind to our reported results as well as underlying earnings per share growth and in the effective period using the current exchange rate. With that said, let's review our guidance metrics. Low single digit net sales revenue growth on a constant currency basis, mid single digit underlying pretax income growth on a constant currency basis, high single digit underlying earnings per share growth, underlying free cash flow of $1,300,000,000 plus or minus 10% underlying depreciation and amortization of $675,000,000 plus or minus 5% net interest expense of $215,000,000 plus or minus 5%, underlying effective tax rate in the range of 22% to 24% and capital expenditures incurred of $750,000,000 plus or minus 5%. Drivers that underpin our guidance include anticipated annual net price increases of 1% to 2% in North America, in line with the average historical range and for other markets to trend in line with inflation.

Mix should be a meaningful growth driver as we advance toward our medium term goal of reaching about one third of our global net brand revenue from our above premium portfolio. We expect this to come from continued premiumization in EMEA APAC and Canada, as well as progress in The U. S. Where as Gavin shared, we are starting to see some initial traction with Blue Moon, a big change for Peroni and are expanding in non ALK. While Fevertree and the consolidation of Zoa provide incremental benefits to the top line, we will also be cycling revenue from the smaller regional craft breweries we divested in the third quarter and more significantly twenty twenty four Pat's and Labatt contract brewing volume as these contracts terminated at the end of last year.

On a combined basis, we expect to relate an approximate 1,900,000 hectoliter headwind to America's financial volume in 2025. We produced about 1,200,000 hectoliter of PAPS in The U. S. And 700,000 hectoliter of Labac brands in Canada in 2024. Given that PAPS volumes wound down sequentially over the course of 2024, the headwind is more pronounced in the first half of the year, particularly in the first quarter.

And the 2024 Labatt volumes follow typical seasonal trends. There are several additional shipment phasing considerations. In the first quarter, we are cycling particularly strong demand for our core power brands in The U. S. In the prior year period when U.

S. Brand volumes were up 5.7%. Also in the first quarter of twenty twenty four, we benefited from higher than typical inventory growth given our anticipation of the fourth worst strike. This contributed to U. S.

Financial volume increasing 7.6% in the first quarter of twenty twenty four despite the exit of 350,000 hectoliters of tax volume. This higher than typical inventory build extended into the second quarter of twenty twenty four and we do not anticipate a similar level of first half inventory build in 2025. Turning to costs, in the first quarter, we anticipate incurring one time transition and integration fees related to the Fever Tree Partnership, which will be reported in our underlying results. The costs will be determined over the next few months based on discussions, which are ongoing. We also expect full year margin expansion coming from a number of drivers.

They include mixed benefits from lower contract brewing and increased premiumization, moderating inflation on input costs and productivity improvements and cost savings. We also expect to continue to put the right commercial pressure behind our brands globally, focusing on retaining existing customers and attracting new ones. Given our deep capabilities and return oriented strategy, our growth outlook does not require us to make steep changes in our marketing investments. In closing, we are pleased with our progress in 2024. We believe we have the right strategy and with strong brand, a highly cash generative business model and a healthy balance sheet, we have the ability to continue to invest in our business to achieve long term financial growth and our strategic goals, while also returning cash to shareholders through a growing dividend and a meaningful share repurchase program.

With that, we would like to open it up to your questions. Operator?

Thank you. We will now begin the question and answer session. You.

Our first question comes from Chris Carey with Wells Fargo. Please go ahead.

Hey, Gavin. I was wondering if you could comment a bit on what we're seeing in the beer category, specifically year to date or whatever near term time horizon you'd like to use. I think there's been a debate about increased volatility in recent weeks and months, whether that's weather or changing consumer preferences. But I'd love to get your thoughts on some of the near term evolution of what we're seeing in the data and how you see industry dynamics, and perhaps how you're thinking about this in the context of your full year guidance. And then more of a just sneak in question, but Tracy, are you factoring any share repurchases in the outlook or any context on fair buybacks for this year?

Thanks, Chris. Well, I'll let Tracy answer your sneak in question, but I'll deal with the industry first, Chris. Look, I mean, if you look at 2024, there was a lot of noise, right? I mean, we talked about a lot of it over our earnings calls with trading days and holiday timings and turbulent weather and all sorts of things going on. And summer was not particularly good, but we did see progress in Q4.

And in fact, I think Q4 ended up being the best quarter of industry performance that we experienced last year. And Chris, as it relates to current trading, I would say what we said on the last call and I think the call before that, right, is I think being cautious of short term trends is important, right? Because I think once you get to the full quarter and you remove noise that exists on a week to week basis, you get a much better sense of what's happening in the industry. And even with what you're seeing in the first publicly available data for 2025, it's not terribly dissimilar to what we were experiencing in 2024. Again, there is noise around weather and timing of holidays.

And I would just caution you not to draw assumptions based on a very short period of data. Chris?

Chris, so just in terms of share repurchases, so we do intend to continue to execute our share repurchase program. And a reminder, it increased both its systematic as well as an opportunistic execution component. So that allows us to consistently execute the program, but with also the ability to lean in if our models indicate if appropriate. So based on our $2,000,000,000 program, which we announced in October 2023, and as Gavin said, we've already utilized about 40% of it in just the first five quarters and it is a five year program. So I think it's clear our commitment to share repurchases.

But the execution of the plan can vary, can be driven by a number of factors including the timing of our capital commitments. For example, a planned investment in Fevertree could drive that. But as I said, we are committed to the share repurchase program that we put in place. Thanks, Chris.

Our next question comes from Peter Grom with UBS. Please go ahead, Peter.

Thanks, operator. Good morning, everyone. I really wanted to just follow-up on Chris' question there, just some perspective on the top line guidance. I know there are various puts and takes, Tracy, as you alluded to, contract brewing, cedar tree, etcetera. But I guess just how are you actually thinking about underlying category growth across your key geographies?

Are you assuming category growth rates improve as we move into the summer, cycle into your comps? Or are you kind of assuming the steady state of category growth improves that would be more of

Thanks, Peter. Look, if you look at our major markets, right, in Canada, we've seen past inflation and interest rates that continue to weigh on the economy. But we have seen interest rate cuts, we've seen inflation start to come down. And Canada beer industry trends are fairly similar to The U. S.

As I said to Chris, we're not seeing anything meaningfully different from the previous trends that we've shared in The U. S. Very conscious consumers are still looking to engage in channel and pack shifting. And at the same time, the industry continues to see premiumization, which plays perfectly into our overall acceleration plan. In The U.

K, the economy is improving. Inflation is slowing down. It is competitive at the moment, but not a lot different from what we've been seeing through the back end of 2024. And as you rightly point out, we do have puts and takes in our top line guidance, right? The take, as Tracy said, is contract brewing and the pull is Fever Tree, for example.

But more broadly, the progress that we're making on our overall acceleration plans, whether that's our core brands globally, whether it's the premiumization progress that we're making or whether it's acceleration in Beyond beer. So it's all of those factors taken into account, Peter.

Thank you. Our next question comes from Filippo Saloni with Citi. Please go ahead.

Hi, good morning, everyone. I wanted to ask on margins. So first on the gross margin line, can you provide some context of the puts and takes in terms of pricing, mix benefits and commodity inflation that you expect that you include in your guidance? And particularly on the commodities, I know you have long term hedging programs. So just any thoughts on the potential impact of aluminum tariffs and what that could mean for your COGS?

I'll let Tracy talk about the margin, Filifai, and thanks for the question. From an aluminum point of view, we did make changes to our sourcing strategy over the last few years. And so almost all of our aluminum is currently purchased in The United States for United States consumption, which is obviously our biggest market. But Trace, do you want to give a more broad

Yes, sure. So happily that. So in terms of gross margin, look, we don't give specific gross margin guidance, but notably, our underlying gross margin percentage did improve in each of the last two years. So as we look at our 2025 guidance, our long term growth algorithm does anticipate underlying pretax margin expansion. So building on the expansion we saw in 2024.

Some of the drivers of that, so in 2025, we do expect moderating inflation on input costs. And to your point, we do have multiple leaders that support our growth algorithm. So it includes positive net pricing that we discussed in our guidance, Positive mix from premiumization as well as the lower contract brewing volumes, which will also drive productivity improvements and we also continue to look at cost savings across entire business. So those are some of the things that I would say would drive some of the margin expansion.

Our next question comes from Bonnie Herzog with Goldman Sachs. Please go ahead, Bonnie. All right. Thank you. Good morning, everyone.

I actually had a question. Good morning. I had a question on your guidance, which you mentioned is in line with your long term algo. Your guidance implies a fair amount of operating leverage this year.

And I know you've touched on this, but hoping you could unpack this a bit for us, meaning, you should get some leverage from the top line. But could you give us a little more color on the drivers of EPS growth such as the cost savings and efficiencies you expect to get this year? And then maybe how much that could increase next year and beyond? Maybe if you don't feel comfortable quantifying, maybe you could rank some of these cost savings in order of impact, for instance. I think that would be helpful.

Thanks, Bonnie. Francesca, you want to take that?

Yes. So I mean a couple of things that I can point to in terms of the operating leverage and improvements in our operating margin. So number one, we've invested over the last couple of years in our capabilities to drive efficiencies and cost savings. And a lot of that investment is focused on our breweries. So eliminating waste, driving efficiencies there and certainly taking out the contract brewing will further help in terms of costs as well as efficiencies in our brewery.

So that's one of the bigger drivers around the cost and efficiencies. The other thing just in terms of marketing spend, for example, we spent the last couple of years really driving our return on marketing investments. And even though we do expect our engine rates increase around some of the investments that we're making with innovation, Fever Tree, etcetera. There's also a number of puts and takes that is coming out. So for example, we divested of underperforming craft breweries and we can now redeploy those funds to other brands in 2025.

So we'll continue to look at that. And then one of the bigger items as well is bringing the Peroni production onshore. And these meaningful ocean freight savings by doing that and we've been able to utilize those cost savings to again support the marketing investment of that brand. So a number of levers that we can pull in a number of capability investments that we've made over the last couple of years that we'll start seeing coming through now that will certainly help our margin as we look at continuing to drive efficiencies in the areas that we operate.

Thank you. The next question comes from Andrea Teixeira with JPMorgan. Please go ahead.

Hey, good morning. This is Drew Levine on for Andrea. Thank you for taking our question. Gavin, I wanted to ask on The U. S.

Brand volumes were down three. I think that came in probably a bit better than the track channel data would suggest, despite I think what has been described by some other peers as maybe a shift towards those channels. So, you know, any color would be helpful on what you're seeing from a consumer perspective. I know you'd mentioned, some moderation in the value seeking behavior, but maybe some perspective on different channels if on premise is outperforming, maybe on track channels performing better. So any help there would be great.

Thanks, Drew. I think one point I'd make is I think there was an extra trading day. So that certainly would have helped. From a consumer point of view, we did see them moving away from C stores earlier in the calendar year in the sort of summertime period. Now we've seen them move back into the C store channel.

We've also seen on premise continue to slightly outperform. But broadly, I would say those are the three key ones. Thanks, Drew.

Thank you. The next question comes from Gerald Pastorelli with Needham and Company. Please go ahead.

Great. Thanks very much for the question. I just I wanted to go back to the share repurchase commentary. So as we look at the outlook for 2025, the high single digit growth, Tracy, is it fair for us to assume that you maybe to think about it in terms of like straight lining the remaining authorization with any potential upside to earnings growth being you remaining aggressive on buybacks, but that maybe shouldn't be part of the base case scenario? Just trying to get a little bit more color there.

Yes. So a couple of things to consider as we talk about the high single digit underlying EPS growth. I mean, some of that, yes, certainly is being driven by share repurchases. Our guidance assumes at minimum repurchases in line with our 10b5-one plan. But some other factors that play into our EPS growth is also tax and foreign exchange.

So, our EPS is not on a constant currency basis. So, forex could impact that. And then we have reduced the underlying effective tax rate guide for twenty twenty five to 22% to 24% and that was from the 23% to 25% in 2024. But as I said, we'll continue to look at all of our capital allocation models and make sure that we're returning the right we're making the right investment decisions to return to our shareholders. So, yes, as we said, it could vary.

The share repurchase is driven by a number of factors, as I said, whether we have planned investments like Fevertree, for example. So that may impact the sort of amount we spend and also just as a reminder, up to five year program and we're only five quarters into this. Thanks, Gerald.

next question goes to Rob Ochonson of Evercore. Rob, please go ahead. It looks like Rob has disconnected. He's going on to the next question from Kevin Grundy of BNP Paribas.

First, quick housekeeping question then a bigger picture question, easy for me to say. A housekeeping question for Tracy, it would seem like the guidance would imply that volumes down 1% to 2% based on your commentary of 1% to 2% price and then some favorable mix. I just wanted to confirm that's your expectation relative to an exit rate that was a bit more challenging that in The U. S. And Europe.

Gavin, the bigger picture question, is just the demand outlook looking out now over the longer term. We get a lot of questions from investors on potential impact of younger consumers drinking less frequently, negative impact from GLP-one, the recent advisory from the former Surgeon General linking alcohol consumption and cancer risk. I was hoping you could comment on these potential headwinds and how they may impact the industry more broadly. So not just beer, but U. S.

Alcohol more broadly? And then how it may directly impact your strategy as it pertains to your portfolio? Thank you.

Thanks, Kevin. Do you want to just comment on the first one, Tracey? I'll take the bigger picture question.

Molson Coors Beverage (TAP) Q4 2024 Earnings Call Transcript

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